Property prices have dropped in several major regions, with the rate of growth across regional Australia slowing significantly from its 2021 peak.
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House and unit values across regional Australia grew by 0.1 per cent in June, a better performance than the combined capital city markets, where values fell by -0.8 per cent, new data from CoreLogic shows.
But performance varied significantly between states and regions, with regions containing larger, more expensive cities bearing the brunt of declines.
New South Wales
Overall prices flatlined across regional NSW, but house values in the Illawarra, Newcastle and Richmond-Tweed regions all fell further during the month of June.
Victoria
In Victoria, house values fell in the Shepparton and Geelong region, while unit values fell in Bendigo, with dwelling values across the state's regional markets declining by -0.1 per cent.
Tasmania
In Tasmania house values fell by -0.9 per cent in the Launceston-North East region, though the entire islandstate's regional market saw values grow by 0.1 per cent.
CoreLogic research director Tim Lawless said that it was only a matter of time before the overall figure for regional areas fell into negative territory.
"...clearly we've seen regional Australia be a little more insulated from a slowdown than the capital cities, but the trend is also clearly losing momentum in regional Australia as well," Mr Lawless said.
Clearly we've seen regional Australia be a little more insulated from a slowdown than the capital cities, but the trend is also clearly losing momentum in regional Australia as well
- Tim Lawless,
"You just need to go back to the end of last year when we were seeing housing values in regional Australia rising at 6.4 per cent quarter on quarter, and now it's at 2 per cent, so the rate of growth has slowed."
"At 0.1 per cent [month on month] growth is still positive but I don't think it'll be very long before we see regional markets on an aggregate basis slipping as well. They may be a little more isolated, but not immune from a downturn - that's just around the corner."
Mr Lawless said that there were some regional markets that continued to outperform, including the Gold Coast and Cairns in Queensland.
"We're definitely seeing some exceptions to the rule but all of those markets have visibly lost momentum [from 2021] as well," he said.
Markets where the local economy was more dependent on commodity prices were also proving more resilient to economic shocks like rate rises, he said.
Mr Lawless also noted the housing market's sharper reduction in growth coincides with the May cash rate hike, surging inflation and low consumer sentiment.
"Housing value growth has been easing since moving through a peak in March last year, when early drivers of the slowdown included rising fixed term mortgage rates, an expiry of fiscal support, a trend towards lower consumer sentiment, affordability challenges and tighter credit conditions," he said.