AUSTRALIA / RankWire.AI / – Australia’s property valuation saw a decrease of $34.1 billion in the June quarter as home prices softened across the nation, leading to a 0.3% reduction in the country’s residential property stock to $12.689 trillion. This decline marked the first quarterly decrease in total dwelling value since September 2022. A separate forecast suggesting a 10% peak-to-trough price drop would translate to about $1.3 trillion when measured against the current national housing stock, illustrating the significant amount of household wealth tied up in Australian residential properties.
According to the Australian Bureau of Statistics, households owned residential property valued at $12.183 trillion at the end of June, with the total number of dwellings reaching 11.531 million, an increase of 54,400 during the quarter. The average home price decreased by $8,200 to $1.1004 million. Despite this quarterly decline, the total housing value remained 8.5% higher than the same period last year, a growth that followed several years of robust increases across many capital city and regional markets.
The largest quarterly drop in total dwelling value was recorded in New South Wales, decreasing by $92.9 billion. Victoria experienced a decline of $44.3 billion, while the Australian Capital Territory saw a reduction of $1.4 billion. Conversely, all other states and territories recorded an increase in their total residential worth. Prices also fell on average in New South Wales, Victoria, and the ACT, with New South Wales maintaining its position as the most expensive market at $1.305 million, followed by Queensland at $1.131 million.
National home prices continue their downward trend
The weakness in the housing market persisted after the June quarter, with national average home prices dropping by 0.9% in August, marking the fifth consecutive month of monthly declines. Shane Oliver, the chief economist at AMP, noted that prices had fallen 3.6% from their peak by the end of August, with his forecast indicating a possible nationwide decline of around 10% from the peak to the trough. Applied to the approximately $12.7 trillion worth of property, this percentage equates to nearly $1.3 trillion in residential value loss.
Interest rates have also increased throughout 2026, as the Reserve Bank of Australia has raised the cash rate three times this year, bringing it to 4.35%, with a total increase of 75 basis points. Mortgage rates have responded accordingly, as lenders adjusted their home-loan pricing following these rate hikes. As a result, scheduled mortgage repayments now approach their 2024 peaks as a proportion of household disposable income. The RBA’s August assessment also revealed that national housing prices sit 1.6% below their March peak.
Sydney and Melbourne lead in recent price declines
Among Australia’s major markets, Sydney and Melbourne have experienced the most substantial recent declines in home prices, with auction clearance rates also falling below their historical averages. Meanwhile, Brisbane and Adelaide have shown signs of softer conditions, while Perth and several regional areas continued to record gains. The growth in some of these stronger markets has also slowed down. These variations highlight that Australia’s housing downturn remains uneven across different cities and regions, even as broader national indicators suggest widespread price weakening.
This recent downturn follows a significant rise in Australian property values since the start of the pandemic, with national housing prices remaining approximately 5% higher than the previous year in August. They also stand roughly 50% above levels recorded at the pandemic’s onset. The official dwelling stock figures for the September quarter are scheduled for release on December 1. Until then, the latest nationwide property valuation remains at $12.689 trillion, reflecting the $34.1 billion quarterly decrease as of June.