Melbourne’s housing market has experienced a continued downturn, with median house values dropping for the fifth consecutive month. As of the latest PropTrack Home Price Index, the median house value in the city stands at $914,000, which is $16,000 lower than a year ago. This reflects a 1.75 percent decrease over the past year and a $2,000 (0.2 percent) decline in the past month alone. In contrast, the median value of units has remained relatively stable, currently at $609,000—only $500 higher than a year ago.
The decrease in house values is partly attributed to recent government taxes that have driven investors to sell their properties, resulting in reduced buyer demand. Despite these trends, there is a glimmer of optimism for homeowners as PropTrack reported a preliminary auction clearance rate of 69.1 percent from 559 results out of the 1,103 scheduled auctions this week.
Eleanor Creagh, senior economist at PropTrack, noted that while the declines in home values are modest, they may lead Melbourne homeowners to look enviously at other states with rising prices. She highlighted that regional Victoria has seen a more pronounced drop, with the median house price falling by $11,000 (1.88 percent) to $595,000, though unit values have remained largely stable.
Creagh pointed out that the market’s fluctuations are partly due to an imbalance between the number of listings and buyer demand. With investor sales increasing and the total number of homes for sale at its highest since 2018, there is a potential for a market floor to develop as the state’s population grows and housing approvals decline. She anticipates that by Christmas, clearer signals on interest rates could help boost buyer activity in the new year.
