PHOTO: Home prices in Adelaide have defied the property downturn. FILE
Property prices have been heavily impacted by rising interest rates, but one Aussie state has seen prices stay well above pre-pandemic levels.
It has been three years since COVID-19 was declared a global pandemic and Aussie borders were shut off – which led to a surprising property boom.
But now, with rising interest rates causing mortgage repayments to soar, property prices have taken a hit.
However, not all areas have been affected the same, with one Aussie state still seeing home prices well above pre-pandemic levels.
According to new CoreLogic research, property prices in regional South Australia are around 50 per cent higher now than they were in March 2020.
And it’s not just the regional areas where prices have remained stubbornly high. The Greater Adelaide region is seeing home prices around 47 per cent higher than March 2020.
“In the past three years, Adelaide houses have come out on top across the capital cities, with values sitting 43.7 per cent higher than at the end of March 2020. This is the equivalent of a $211,097 increase on the median house value across the city,” CoreLogic said.
“This is much stronger than the equivalent median house value gain in Sydney (which has risen the equivalent of $119,830), and Melbourne house values have actually seen a decline since March 2020, down the equivalent of -$1,009 at the median house value level.”
Nationally, home values rose 28.6 per cent from September 2020 to April 2022, CoreLogic research found.
But the rapid rise in interest rates soon converted those massive gains to the largest and fastest downswing on record, with a 9.1 per cent fall from April 2022 through to the end of February 2023.
Annual sales volumes are down 21.5 per cent from a peak in December. However, despite the recent volatility, home values remain 14.8 per cent higher overall.
“In recent weeks, the market has shown signs of stabilising at this higher level, but it may be too soon to call the bottom of the market amid ongoing interest rate rises,” the research said.
“It’s likely that once interest rate hikes are paused, the movement in sales volumes and home values may become less extreme.”
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