AUSTRALIA / RankWire.AI / – Australia’s housing market experienced a $34.1 billion decrease in value during the June quarter, reflecting a slowdown after years of strong growth. The total national housing stock decreased by 0.3%, bringing its value to $12.689 trillion. This marked the first quarterly decline since September 2022. A forecast predicting a 10% peak-to-trough home-price decrease, published this month, suggests a potential loss of approximately $1.3 trillion when applied to the current property stock, underscoring the significant wealth tied to Australian real estate.
According to the Australian Bureau of Statistics, households held $12.183 trillion in residential property at the end of June. Australia’s housing stock comprised 11.531 million dwellings, an increase of 54,400 during the quarter. Nonetheless, average dwelling prices fell by $8,200 to $1.1004 million. This quarterly decrease signals a shift from the robust growth seen in recent years. Despite the decline, the total value of the country’s housing remains 8.5% higher than it was a year ago.
The largest decline occurred in New South Wales, which lost $92.9 billion in housing value during the quarter. Victoria experienced a $44.3 billion drop, and the Australian Capital Territory saw a reduction of $1.4 billion. Conversely, residential values in all other states and territories increased. The average dwelling price also fell in New South Wales, Victoria, and the ACT. Nevertheless, New South Wales maintained the highest average at $1.305 million, followed by Queensland at $1.131 million.
Rising Borrowing Costs Drive Downward Home Price Trends
Recent market data indicate the housing slowdown persisted beyond the June quarter. In August, national average home prices dropped 0.9%, marking the continuation of a five-month trend of monthly declines. AMP chief economist Shane Oliver noted that prices had fallen 3.6% from their peak by the end of August. His outlook estimates a roughly 10% peak-to-trough decline on a national scale. Applying this percentage to Australia’s residential property value of approximately $12.7 trillion suggests a potential loss of about $1.3 trillion in total wealth.
The slowdown is also linked to increased borrowing costs. The Reserve Bank of Australia has raised the cash rate three times in 2026, reaching 4.35%. These hikes amount to 75 basis points overall. Financial institutions have adjusted mortgage and deposit rates accordingly, pushing scheduled mortgage payments close to their 2024 peak relative to household disposable income. The central bank’s August assessment revealed that national housing prices are 1.6% below their March high.
Major Cities Lead the Drop in Housing Prices
Sydney and Melbourne have seen the most significant recent declines among the largest markets, with auction clearance rates falling below their long-term averages. Price reductions are increasingly felt nationwide, though regional differences remain pronounced. Brisbane and Adelaide showed some weakening in the latest central bank report, while Perth and other regional areas continued to experience price growth, albeit at a slower pace. These regional variations contribute to a varied national downturn across different housing markets.
Despite the recent declines, national property values remain about 5% higher than a year ago, according to the August assessment. They are also roughly 50% above pre-pandemic levels. Official dwelling stock data for the September quarter is scheduled for release on December 1. Until then, the latest available national figure remains the $34.1 billion decline recorded through June.