| 25 August 2022

Key points in this blog 👇

  • Home prices in Australia decreased by 0.43% over the month of July.
  • Prices in most major cities have seen a decline.
  • Adelaide and Perth have seen growth.
  • Most homeowners who purchased over a year ago will still see an overall increase in their equity.

As the new financial year continues and rates continue to rise, we can now see how it is affecting the property market all over the country. In PropTrack’s recent Home Price Index, author and senior economist, Paul Ryan, demonstrated how home prices in Australia had decreased by 0.43% over the month of July. Prices in Sydney, Melbourne, Brisbane, Hobart, Darwin, and Canberra saw a decline. However, Adelaide and Perth seem to have dodged this proverbial bullet and saw an increase in house prices in July.

It’s not just the cities, the states they reside in have also seen growth.

“With the increase in prices in July, Adelaide, regional South Australia and regional Western Australia recorded new price peaks,” Ryan stated in the report.

Adelaide saw home prices go up 0.04%, with a median price of $634,000 in July. Perth saw the same growth of 0.04%, bringing the median price to $534,000.

But what about your equity?

While prices may have decreased slightly in recent months, overall, if you bought a house in 2020 (or around that time), it’s highly likely that you’ve still experienced strong growth in your property value, and therefore an increase in your equity. This is one of those cases where it pays to look at the long-term picture.

Consider the table below. While it might be easy to worry about the monthly decrease in July, look at the last column to see the phenomenal growth that properties across the country have enjoyed since March 2020. That puts things into perspective!

PropTrack Home Price Index July 2022

All dwellingsMonthly growthChange from peakChange since March 2020
Adelaide0.04%At peak42.6%
Capital Cities-0.52%-2.29%27.5%
Rest of NSW-0.15%-0.44%51.7%
Rest of VIC-0.32%-1.14%44.4%
Rest of QLD-0.23%-0.54%50.3%
Rest of SA0.33%At peak36.4%
Rest of WA0.24%At peak30.9%
Rest of TAS-0.13%-0.13%54.1%
Rest of NT0.28%At peak13.5%
Regional Areas-0.18%-0.50%48.8%

So, what does this mean for homeowners?

Quite simply, it means that most homeowners who bought their property a couple of years or more ago will still have significant equity in their properties. That’s equity you could potentially invest in new ventures such as renovations or even a new property.

Expert economists are predicting that rates will continue to rise before going back down. If recent data is anything to go by, that could mean further drops in house prices, but most homeowners should breathe easy knowing they are still sitting on significant capital gains and have opportunities to put that equity to work.

At Nectar we’re always keeping our eyes and ears on what’s going on in the market. Our brokers are experts in the field, so when it comes to achieving your financial goals, a conversation with one of our team could be invaluable. If you’re thinking about using your equity to invest, but aren’t sure how to do it, then  get in touch with a Nectar broker near you.