Capital Cities Face a Shifting Housing Landscape

0

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

This new data also highlights a considerable increase in the number of homes being listed for sale in both Sydney and Melbourne. Listings in Sydney alone rose by 6.7% compared to the same period last year, while Melbourne saw a more modest increase of 1.1%.

Eliza Owen from CoreLogic attributes this shift to changing market dynamics. "This time of the year is typically slow in terms of demand, but this goes beyond seasonality," she explains. According to Owen, the increase in listings and the apparent lack of eager buyers may be early indicators of growing mortgage stress among homeowners.

Owen suggests, "There’s less appetite from buyers, but more sellers are coming into the market, which could indicate rising mortgage stress." This sentiment is echoed by Cate Bakos, a buyer's agent in Melbourne, who believes, "Prices can’t be expected to grow while we have higher stock levels and weaker buyer demand."

Interestingly, Brisbane and Perth have reported a deceleration in dwelling value growth, maintaining a rate of just 0.3% over the past four weeks. Such trends suggest a potential buyers’ market, particularly in Brisbane, where supply has surged and demand has slowed, according to Zoran Solano of Hot Property Buyers Agency. "For me as a buyer’s agent, it’s a positive sign that the power has shifted back a little bit towards buyers," she observes.

Further analysis from The Australian Financial Review indicates that property values in Brisbane are declining in one out of seven suburbs, the highest rate in almost two years. CoreLogic’s Tim Lawless sees this as a sign that prices may continue to ease due to increased listings, reduced interstate migration, and affordability challenges. "The market is likely to continue to ease, and we could see prices moving into a subtle decline before interest rates come down," he remarks.

AMP chief economist Shane Oliver predicts a similar trend, highlighting Brisbane as a market where values might soon turn negative, following the pattern seen in Sydney and Melbourne. "Brisbane looks to me like a really soggy market and I wouldn’t be surprised if house prices go negative in the next couple of months," Oliver comments.

Oliver also suggests that potential interest rate cuts could reverse this downward trajectory. "A rate cut could turn that downward momentum around, so if it occurs in February it has the potential to head off a dip into negative territory for Brisbane prices," he explains, warning that delays in rate cuts might extend the price downturn.

Meanwhile, PropTrack notes an 80% spike in Brisbane home values since the pandemic’s onset in March 2020, which has positioned Brisbane as Australia’s second most expensive housing market by median value. However, rising prices, slowing migration, and worsening affordability may soon turn Brisbane into the latest domino to fall in the nation’s housing saga.

Published:Tuesday, 28th Jan 2025
Source: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

Share this news item:

Finance News

Clear

APRA Implements Cap on High DTI Home Loans to Address Housing Market Concerns

08 Dec 2025: Paige Estritori

The Australian Prudential Regulation Authority (APRA) has announced a significant policy change aimed at mitigating risks in the housing market. Effective February 2026, APRA will impose a cap on high debt-to-income (DTI) home loans, limiting such loans to 20% of new home lending portfolios. This measure is designed to address concerns over escalating property prices and the potential for financial instability. - read more

Commonwealth Bank Raises Alarm Over Surging Home Loan Demand

08 Dec 2025: Paige Estritori

The Commonwealth Bank of Australia (CBA), the nation's largest lender, has voiced concerns over the current surge in home loan demand, suggesting it may be contributing to escalating property prices and potential financial instability. CEO Matt Comyn emphasized that while the bank benefits from increased housing credit, a more moderate growth rate would better support long-term financial stability and housing market accessibility. - read more

Major Australian Banks Reduce Dependence on Mortgage Brokers

08 Dec 2025: Paige Estritori

Australia's 'Big Four' banks-Commonwealth Bank of Australia (CBA), National Australia Bank (NAB), Westpac, and ANZ-are strategically reducing their reliance on mortgage brokers in response to squeezed profit margins resulting from lower interest rates, rising operational costs, and intense market competition. Currently, mortgage brokers account for approximately 80% of new home loans in Australia, a significant increase from 50% six years ago. However, banks are now focusing on more profitable, in-house mortgage origination channels. - read more

Australian Housing Market Forecast: 7% Price Increase Expected in 2026

30 Nov 2025: Paige Estritori

Recent analyses indicate that Australian home prices are set to rise by approximately 7% in 2026, an upward revision from earlier projections of 5.6%. This anticipated growth is primarily attributed to a constrained housing supply coupled with resilient demand, particularly in major urban centres such as Sydney, Melbourne, Brisbane, Adelaide, and Perth. - read more

Australian Stock Market Achieves 10% Growth in Financial Year 2025 Amid Global Challenges

30 Nov 2025: Paige Estritori

The Australian stock market has demonstrated remarkable resilience, with the S&P/ASX 200 index recording a 10.2% gain over the 2025 financial year. This performance comes despite a backdrop of global economic uncertainties, including geopolitical tensions and fluctuating commodity prices. - read more

Commonwealth Bank Raises Alarm Over Surging Home Loan Demand

22 Nov 2025: Paige Estritori

The Commonwealth Bank of Australia (CBA), the nation's largest lender, has expressed concerns about the current surge in home loan demand, suggesting it may be contributing to escalating property prices and potential financial instability. CEO Matt Comyn emphasized that while the bank benefits from increased housing credit, a more moderate growth rate would better support long-term financial stability and housing market accessibility. - read more

Westpac's RAMS Financial Group Penalized for Home Loan Misconduct

22 Nov 2025: Paige Estritori

RAMS Financial Group, a subsidiary of Westpac Banking Corporation, has been fined A$20 million by Australia's Federal Court for serious misconduct in its home loan practices between June 2019 and April 2023. The Australian Securities and Investments Commission (ASIC) initiated the lawsuit, citing issues such as the use of falsified payslips to approve loans, engagement with unlicensed mortgage referrers, and inadequate oversight mechanisms. - read more

Australia's Major Banks Reducing Dependence on Mortgage Brokers

22 Nov 2025: Paige Estritori

Australia's 'Big Four' banks-Commonwealth Bank of Australia (CBA), Westpac, National Australia Bank (NAB), and ANZ-are strategically reducing their reliance on mortgage brokers in response to squeezed profit margins resulting from lower interest rates, rising operational costs, and intense market competition. Currently, mortgage brokers account for approximately 80% of new home loans in Australia, a significant increase from 50% six years ago. However, banks are now focusing on more profitable, in-house mortgage origination channels. - read more

Japanese Banks Drive Growth in Australian Business Lending

14 Nov 2025: Paige Estritori

In July 2025, Japanese banking giants Sumitomo Mitsui Banking Corporation (SMBC) and Mitsubishi UFJ Financial Group (MUFG) emerged as significant growth drivers in Australia's business lending sector. SMBC recorded a 4.66% increase in their business loan book, adding A$1.19 billion, while MUFG achieved a 3.63% expansion, contributing an additional A$0.62 billion. - read more

AFIA Unveils New Code to Elevate Non-Bank Lending Standards

06 Nov 2025: Paige Estritori

The Australian Finance Industry Association (AFIA) has recently introduced its Finance Industry Code of Practice, marking a significant advancement in the non-bank lending and specialist banking sectors. This pioneering initiative aims to establish a new standard for integrity, transparency, and fairness within the industry. - read more

Click for more Finance News