AUSTRALIA / RankWire.AI / – Australia’s property sector experienced a $34.1 billion reduction in total value during the June quarter amid a nationwide slowdown in home prices. The residential property stock in Australia decreased by 0.3%, bringing it to $12.689 trillion. This marks the first quarter since September 2022 to see a decline in overall dwelling values. A forecast estimating a 10% peak-to-trough price drop would translate to approximately $1.3 trillion when measured against the current national housing stock. These figures highlight the significant amount of household wealth invested in Australian residential real estate.
According to the Australian Bureau of Statistics, households owned residential properties valued at $12.183 trillion at the end of June. During the same period, Australia’s housing stock increased by 54,400 dwellings, reaching a total of 11.531 million homes. The average value per dwelling decreased by $8,200, now standing at $1.1004 million. Despite the quarterly decline, the total value of the housing market remains 8.5% higher than it was a year prior, reflecting several years of robust growth across numerous capital and regional markets.
New South Wales experienced the most significant quarterly decrease, with total dwelling values dropping by $92.9 billion. Victoria saw a reduction of $44.3 billion, and the Australian Capital Territory declined by $1.4 billion. Conversely, all other states and territories recorded increases in total residential value. Prices also declined in New South Wales, Victoria, and the ACT. Nonetheless, New South Wales continued to lead the nation with an average dwelling price of $1.305 million, followed by Queensland at $1.131 million.
National Home Prices Continue Downward Trend
The housing market’s softening persisted after the June quarter, with national average home prices decreasing by 0.9% in August, marking five consecutive months of monthly declines. Shane Oliver, AMP’s chief economist, noted that prices had fallen 3.6% from their peak by the end of August. His forecast suggests a roughly 10% decline from peak to trough across the country. Applied to the estimated property worth of around $12.7 trillion, this percentage signifies nearly $1.3 trillion in residential value lost.
Interest rates have also climbed during 2026. The Reserve Bank of Australia increased the cash rate three times this year, raising it to 4.35%. These rate hikes total 75 basis points. As a result, mortgage rates rose as lenders adjusted home-loan pricing, and scheduled mortgage repayments now approach their 2024 peak as a proportion of household disposable income. The central bank’s August review also indicated that national housing prices were 1.6% below their March peak.
Sydney and Melbourne Lead the Decline in Property Prices
Among Australia’s major markets, Sydney and Melbourne have experienced the most substantial recent drops in home prices. Auction clearance rates have also fallen below their long-term averages. While Brisbane and Adelaide have shown softer conditions, Perth and several regional areas continue to record gains. The growth in some of these stronger markets has also slowed down. These variations demonstrate that Australia’s housing downturn remains uneven across different cities and regions, despite broader national indicators pointing to overall price weakness.
The current declines follow a significantly larger increase in Australian property values since the onset of the pandemic. In August, national housing prices remained approximately 5% higher than a year earlier, and about 50% above levels seen at the pandemic’s start. Official dwelling stock figures for the September quarter are scheduled for release on December 1. Until then, the latest national property valuation continues to stand at $12.689 trillion, reflecting the $34.1 billion quarterly decrease.