Adelaide home prices could soon surpass Melbourne, PropTrack report reveals

PropTrack’s latest Home Price Index revealed prices in Melbourne fell 0.21 per cent in July, with homes now worth 4.4 per cent less than they were at their peak in 2022.

The slow price growth has been attributed to a stronger flow of new property listings and higher construction rates and sits in stark contrast to other capital cities, with Perth, Adelaide, Brisbane, Sydney and Canberra all showing significant growth.

While Perth recorded the highest annual price growth at 22.8 per cent, PropTrack senior economist Paul Ryan said all eyes were on Adelaide where the average home now sells for around $770,000, according to the report.

The median sits slightly below the latest Valuer-General’s quarterly figure of $785,000, due to a difference in data collection methodology.

“Prices increased a further 0.58 per cent in Adelaide in July, to be 14.8 per cent higher over the past year,” Mr Ryan said.

“The relative affordability across the city has made Adelaide the strongest performing market since the onset of the pandemic. But ongoing price growth means values may eclipse Melbourne over the coming year.”

In Adelaide, the PropTrack Property Index showed property prices increased by 0.58 per cent seeing the median house price reach $770,000, an increase of 10.93 per cent in the last 12 months.

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In Melbourne, the PropTrack Property Index showed property prices fell -0.21 per cent which saw the median house price drop to $803,000, an decrease of -0.82 per cent in the last 12 months.

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Brisbane home prices also rose by 0.34 per cent in July, 0.12 per cent in Sydney and 0.12 per cent in the ACT.

Much like Melbourne, prices also fell 0.15 per cent in Darwin and 0.04 per cent in Hobart.

Nationally, home prices hit a new peak, inching up 0.08 per cent over July.

Australian home prices are now about 43 per cent higher than they were at the start of the pandemic in 2020, Mt Ryan said.

“National home price growth persisted in July, albeit at a slower pace given the seasonally quieter time of the year,” he said.

“Strong housing demand pushed prices higher, despite more homes being listed in what is a higher interest rate environment.

Slow construction activity, above-average income growth and July’s tax cuts are clearly contributing.”

Mr Ryan added further home price growth was expected over the coming months as the market moves into the traditionally busier spring selling season.

“However, the pace of price growth is likely to remain modest as uncertainty about the path of interest rates and affordability challenges constrain buyers’ budgets,” he said.