West Australian property values have started to fall following the nation’s first interest rate hikes in a decade, dropping 0.2 per cent from their peak in July.
In May, the interest rate rose by 0.35 percentage points and, following four more rises to 2.35 per cent, every capital city apart from Darwin recorded a housing downturn in August, according to CoreLogic’s latest Hedonic Home Value Index.
House prices in WA have fallen, but more remote coastal areas such as Mandurah have weathered the storm better than other locations across the state. Credit:
The report shows a similar scenario playing out across the state regions, where only regional South Australia recorded an increase in housing values for the month.
Nationally, values were down 1.6 per cent as of August — the largest month-on-month decline since 1983.
Mandurah, the Wheatbelt and Perth’s north-eastern suburbs were the only areas in WA to record a rise in house values – at 0.5 per cent and 0.6 per cent growth respectively — and made up just three of just seven regional sub-regions on CoreLogic’s list to record a rise.
WA’s northern outback and Perth’s inner suburbs had the greatest decline, at 1.6 per cent and 0.9 per cent.
CoreLogic’s research director Tim Lawless said the downturn would continue to play out through the remainder of the year, and possibly into 2023.
“It’s a bit of a wild card … it’s hard to see housing prices stabilising until interest rates find a ceiling and consumer sentiment starts to improve,” he said.
“However, Perth and much of WA is much more affordable than bigger state capitals such as Sydney, and this means the market is better insulated from rising interest rates.
