House prices now falling in Brisbane and Adelaide and not just Sydney and Melbourne

Property prices are now falling in Brisbane and Adelaide and flatlining in Perth in a sign interest rate rises and Labor’s changes to negative gearing and capital gains tax concessions are becoming a national problem for homeowners.

House values had already been falling in Sydney and Melbourne, on a monthly basis, since February when the Reserve Bank of Australia embarked on the first of three rate hikes for 2026 so far.

But in the 28 days to July 20, Brisbane prices have fallen by 0.5 per cent while in Adelaide they have fallen by 0.3 per cent, new Cotality data showed.

The declines for both previously strong markets, as a leading indicator for July, would mark the first monthly downturns in those cities since early 2023 when the Reserve Bank was last raising interest rates.

Perth values have risen by 0.3 per cent but this would be the flattest gain in three years.

But in Sydney, values have fallen by 1.2 per cent over the past four weeks while in Melbourne they have declined by 1.1 per cent.

Preliminary data for July shows real estate values are on track to this month be falling in four of Australia’s five biggest cities for the first time since late 2022.

This risked sparking the biggest national downturn since 2019, when prices fell 8.2 per cent over 18 months following a banking regulator crackdown on interest-only loans, Cotality head of research Gerard Burg said, blaming rate hikes and Budget tax changes.

“It’s not out of the realms of possibility,” he told The Nightly.

Wealthy suburbs in Sydney, Melbourne, Brisbane, Perth and Adelaide are seeing the biggest falls as higher interest rates reduce the lending capacity of the banks for prestige properties.

“You look at those higher value suburbs, you’ve got a smaller pool of buyers to begin with — rate changes are going to affect almost every buyer,” Mr Burg said.

“These more expensive suburbs have led the way down.”

Kangaroo Point, across the river from Brisbane’s city centre, is doing particularly badly with its mid-point house price dropping by 4.8 per cent since April to $1.956 million.

A short drive away, West End house prices had fallen by 4.7 per cent to $2.173m, in an inner-city suburb where prices are well above the Queensland capital’s mid-point of $1.225m, where more properties have been listed on the market compared with earlier this year.

“There has been a very rapid deterioration in the Brisbane market more recently,” Mr Burg said.

Perth, another otherwise strong market, has seen beachside postcodes lose value with Swanbourne prices declining by 4.5 per cent over three months to $2.821m.

Nearby Mosman Park prices fell by 3.7 per cent to $2.702m, in an area by the Swan River which is more than double the Western Australian capital’s mid-point house price of $1.093m.

In Adelaide’s beachside postcodes, Semaphore Park house prices fell by 5.3 per cent over the quarter to $1.118m while values in West Lakes fell 3.5 per cent to $1.484m, to both be above the South Australian capital’s $1m median.

Sydney, Australia’s most expensive market, has seen even larger falls with prices at beachside Coogee plunging by 9.5 per cent over three months to $4.291m, or a level still almost triple the city’s mid-point of $1.556m.

Earlwood, a gentrified suburb in the city’s inner-west, saw its median house price also plunge by 9.5 per cent to $2.040m.

Melbourne’s bayside suburbs in the south-east are also leading the way down with Beaumaris prices falling 6.9 per cent over three months to $2.336m, or more than double the Victorian capital’s mid-point of $948,482.

Surrey Hills prices fell by 6.6 per cent to $2.103m.