PropTrack Home Price Index – December 2023

Anne Flaherty
Anne Flaherty

Capital city prices have fallen for the first time in 2023, while growth in regional areas has maintained home values at peak levels in December.

PropTrack’s Home Price Index shows that national home prices held steady at peak levels in December, having risen by 5.52% over the year.

Buyers benefited from more choice over the last quarter of 2023, helping to alleviate competition and contribute to the slower pace of growth seen over the past few months.

Adding to the downward pressure on prices was the Reserve Bank’s decision to raise interest rates in November – the 13th rate rise seen in less than two years.

Key findings from the December 2023 report:

  • National home prices held steady in December as growth in regional areas counteracted falls in the capital cities. Overall, prices have risen by 5.52% in 2023.
  • After hitting a fresh peak in November, combined capital city prices fell 0.09% in December, marking the first time prices have declined this year.
  • Across December, price falls were seen in Sydney (-0.08%), Melbourne (-0.55%), Hobart (-0.41%), and Canberra (-0.66%). Perth (+0.69%) and Adelaide (+0.59%), in contrast, continued to record strong growth, with prices also up in Brisbane (+0.27%) and Darwin (+0.1%).
  • In contrast to the mixed movement across Australia’s capital cities, combined regional areas saw prices up in every state in December, resulting in monthly growth of 0.23%. Regional home prices reached a new peak in December, having risen by 3.2% over 2023.
  • Regional Queensland and South Australia were the key drivers of growth, up a respective 0.51% and 0.5% over the month to reach new peaks in December.

Download the PropTrack Home Price Index – December 2023 report in full

Home values hold steady in December

National home prices remained unchanged between November and December but have shown mixed movement across markets and property types.

Nationally, house prices displayed greater resilience across Australia’s capital cities in December, falling by just 0.05% compared to a decline of 0.26% for units. Across regional markets, however, this trend was reversed, with median unit prices up 0.46% in contrast to growth of just 0.19% for houses.

This is consistent with the trend seen over the past 12 months, in which houses have outperformed units across capital cities, while the reverse has proved true in the regions.

National home prices were in decline between March and December 2022 in response to aggressive increases to interest rates. Despite a further five interest rate rises in 2023, home prices steadily recovered these falls, reaching a new peak in August from which prices have continued to grow.

But while prices have continued to rise, the pace of growth has steadily slowed to finally hold steady in the last month of the year. Contributing to the slowdown in the rate of growth has been the squeeze on household budgets from the combined impacts of higher interest rates and inflation, as well as an increase in the level of stock being listed for sale.

Capital cities outperform regions for growth in 2023

While rest of state areas saw stronger growth over December compared to the combined capital cities, comparing year-on-year, Australia’s metro areas came out on top.

Home prices across the combined capital cities increased by 6.44% over the year ending December, just over double the 3.2% growth seen across the combined rest of state areas.

Despite the outperformance of capital cities over 2023, comparing pre- and post-COVID, regional markets remain well on top. Compared to March 2020, median home prices across combined regional markets are sitting 50.4% higher, compared to 31.8% growth for the capital cities.

City highlights

Price growth was mixed across the capital cities in December. Perth and Adelaide led the pack, rising a respective 0.69% and 0.59% over the month, while price gains were also seen in Brisbane (+0.27%) and Darwin (+0.1%).

In contrast, Canberra (-0.66%) recorded the sharpest drop in prices over the month, followed by Melbourne (-0.55%), Hobart (-0.41%) and Sydney (-0.08%).

While the combined capital city median home price slipped 0.09% from the record high reached in November, Perth, Adelaide, and Brisbane all reached new peaks in December.

In contrast to the mixed performance of the capital cities, every rest of state area saw prices up over December, with the strongest growth recorded in regional Queensland (+0.51%), regional South Australia (+0.5%), and regional Western Australia (+0.23%). Prices in these three rest-of-state areas all reached new record highs in December.

Looking back over 2023, Perth has proven to be the strongest performing property market, with the median price of a home sitting 14.75% higher compared to 12 months ago. Not only was this the strongest performance among the capital cities, growth in Perth also outpaced that seen in any of Australia’s rest-of-state areas.

Supporting home prices, buyers in Perth have faced relatively limited choice. As a result, those properties that are hitting the market are attracting high levels of buyer interest and homes are selling at close to record speeds.

Adelaide followed Perth as the second strongest performing market in 2023, with total growth of 10.89%. Adelaide’s relative affordability and limited stock for sale have been key contributors to its growth, providing it greater resilience against a backdrop of rising interest rates.

Brisbane has been another outperformer, with home prices up 10.45% compared to 12 months ago. High levels of population growth post-COVID have supported demand for real estate in recent years, making Brisbane one of the strongest performing markets.

But not all markets have seen prices up over the past 12 months. Hobart has been the weakest performing market over the past 12 months, with prices down 3.5% over the year and 8.18% lower than their peak level reached in March 2022. Home prices in Hobart have been trending downwards for close to two years, due in part to the abnormally high levels of growth seen during the pandemic when exceptionally strong buyer demand drove rapid growth in prices. Buyer demand has since normalized and prices have corrected in response.

Darwin is the only other capital city to have seen prices fall over 2023, with the median home price down 1.49% from 12 months ago.

House prices outperform units

The national median house price held relatively steady over December, rising just 0.01% over the month, though up 5.68% over the year. Unit performance was weaker, with prices falling 0.09% over the month and rising at a more modest 4.73% over the year.

The story differs between capital city and regional areas, however. House prices increased more than units over 2023 across the combined capital cities (6.83% versus 4.68%), while in regional areas units (+4.89%) outperformed houses (2.92%).

WA, Queensland and SA dominate list of best performing regions

The top four best performing regions for price growth in 2023 were all located in Western Australia, with Perth’s South West experiencing the strongest growth over the year, at 18.23%. South Australia is also home to a number of strong markets, with Adelaide’s North and the Barossa-Yorke-Mid North experiencing the strongest price growth in the state. Queensland rounded out the top ten, with the Ipswich and Logan-Beaudesert regions recording the strongest annual price growth in the state.

In general, the regions that tend to come out on top for price growth tend to be more affordable areas, where the cost of a home typically sits below the respective capital city’s median.


Home prices have proved remarkably resilient over 2023, however several factors are curtailing the pace of growth. Interest rates were increased in November, the 5th time interest rates have risen this year. Since May last year interest rates have increased 13 times, or by 4.25 percentage points, reducing the average amount a buyer can borrow by around 30%.

Higher interest rates and inflation are squeezing budgets, with the most recent data from the Australian Bureau of Statistics showing that the average ratio of household savings to income had fallen to just 1.1% in September – the lowest level seen since December 2007 at the onset of the Global Financial Crisis.

Despite the challenges households are facing, property prices are expected to remain resilient in 2024. Australia’s population is experiencing rapid growth which is driving up the need for more housing. At the same time, the speed at which new housing is being developed is slowing, with the total number of dwellings approved 16% lower over the first 10 months of 2023 compared to the same period last year.

More people and a slowdown in the delivery of new housing will help to maintain property prices at or above their current levels in most markets in 2024, despite the broader economic headwinds facing buyers.

Methodology: The PropTrack Home Price Index measures the monthly change in residential property prices across Australia to provide a current view on property market performance and trends. PropTrack Home Price Index uses a hybrid methodology combining repeat sales with hedonic regression. The repeat sales method matches resales of the same property while the hedonic regression estimates values based on the value of similar properties. The hybrid model allows two properties in the same Australian Bureau of Statistics Statistical Area 1 (SA1) region, of the same type, to be matched and controls for differences in property characteristics, as in a hedonic regression. The PropTrack Home Price Index is a revisionary index with the whole back history updated monthly with current transaction information.

** This report uses internal data and data sourced from third parties, including State government agencies. It is current as at the time of publication. This report provides general information only and is not intended to constitute any advice and should not be relied upon as doing so. If you wish to cite or refer to this report (or any findings or data contained in it) in any publication, please refer to the report as the ’PropTrack Home Price Index Report – November 2023’. See report for Copyright and Legal Disclaimers.

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