$1.9 million property trend quietly taking hold as prices of home sales slump in 938 suburbs

Nearly a thousand Australian suburbs saw the median house or unit prices of homes that were sold fall in the last quarter in what is arguably a big win for first-home buyers, as well as prospective investors. Those looking to get onto the proverbial property ladder have been facing skyrocketing prices over the last few years, making it almost impossible to get a look in.

However, there are some pockets of the country seemingly bucking that trend and some of the sale price drops have been significant in dollar terms. In Bronte, a sun-soaked beachside suburb in Sydney, the median house price point fell 30.7 per cent in the last three months, according to PropTrack data.

That means, at least in terms of recent sales, $1.903 million has been wiped off the area’s overall median, and brought the postcode from $8.103 million to $6.2 million.

The PropTrack data – based on suburbs where at least 30 homes were sold over the past 12 months – found the suburb with the biggest quarterly drop in percentage terms was Cohuna in Victoria, which saw a head-scratching 42 per cent decline, which equates to a $163,800 fall in the postcode’s median house value.

Following closely behind was Queensland’s Ascot, with house prices falling $1,022,550 from $3,572,550 to $2,550,000, which was a 40.1 per cent drop.

The median value of recent apartment sales in Sydney’s Waverley fell 36.5 per cent, which was a $506,438 decrease, while prices in the state’s Blakehurst declined by $909,315, or 36.3 per cent.

Glebe in the city’s inner west rounded out the top five with a 32.6 per cent, or $782,400 fall in median sales prices from quarter to quarter.

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PropTrack revealed 938 suburbs lost value in the three months to September, with 219 of those being in the double-digit territory.

After Cohuna, Ascot, Waverley, Blakehurst and Glebe, here are the other worst-performing suburbs:

• Bronte, NSW: Houses fell 30.7 per cent to $6.2 million ($1.9 million drop in three months)

• South Hedland, WA: Units fell 30.7 per cent to $327,000 ($100,062 drop)

• Tara, QLD: Houses fell 30.5 per cent to $200,000 ($61,000 drop)

• East Innisfail, QLD: Houses fell 30.5 per cent to $320,000 ($97,280 drop)

• McMahons Point, NSW: Units fell 29.5 per cent to $1.32 million ($390,138 drop)

• Applecross, WA: Units fell 29.1 per cent to $980,000 ($285,180 drop)

• Tookrak, VIC: Houses fell 29 per cent to $4.61 million ($1.336 million drop)

• Kirribilli, NSW: Units fell 28.4 per cent to $1.415 million ($401,860 drop)

• Newcastle, NSW: Units fell 27.7 per cent to $975,000 ($270,075 drop)

• Tocumwal, NSW: Houses fell 27.6 per cent to $505,000 ($139,380 drop)

While North Bondi’s 27 per cent fall for house price sales wasn’t as high as some of the other suburbs, that still equated to a $1.35 million decline on the previous.

It was the same story for Northbridge, NSW, which had $1.127 million wiped off the suburb’s median value from the previous quarter.

REA Group senior economist Eleanor Creagh explained to realestate.com.au that the median sales prices tracked for the data set “reflect the mix of properties that happened to sell in each suburb” from July to September.

This means they weren’t compositionally adjusted in the same way as PropTrack’s Home Price Index, which includes seasonal patterns, and could account for why some price fluctuations are so “exaggerated” in some regions.

When the data is compositionally adjusted, statistical methods are used to show broader changes in the market in either direction.

When this isn’t employed, the data is representative of exactly what was sold, meaning some quarters could see really high-value homes sold (which would see median prices skyrocket), and others could have smaller-value homes sold (which could drop the median price).

Effectively, it shows the general trend towards where the market action is and highlights where certain suburbs are seeing “discounts”.

Creagh said this data could still help buyers identify suburbs previously out of reach that might now be in their price range.

However next quarter could see more wild swings as the spring selling season gets into full speed.

This season is likely to be sent into overdrive as the government’s expansion of the 5 per cent deposit scheme for first-home buyers kicked in on October 1.

The income caps have been abolished and property price caps have been lifted, and it’s meant to help many across the country get onto the property ladder much faster.

However, with more competition in the field, there are concerns that prices could readjust accordingly in the coming months.

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