By James Glynn
SYDNEY--Home prices growth in Australia slowed in December but the market still recorded a strong 8.1% rise through 2023 despite the jump in cost of living and average mortgage repayments.
The rise in CoreLogic's national home value index in 2023 represented a significant turnaround from the 4.9% drop seen in 2022 but remained well below the 24.5% increase recorded in 2021.
Home prices rose 0.4% in December, a relatively soft finish to 2023, with the Reserve Bank of Australia continuing to warn that higher interest rates may be needed.
The RBA's next policy meeting is in early February, with key fourth-quarter inflation data at the end of this month set to determine if the central bank steps on the brakes again.
"A rate hike in June and another in November, along with persistent cost of living pressures, worsening affordability challenges, rising advertised stock levels and low consumer sentiment, have progressively taken some heat out of the market through the second half of the year," said Tim Lawless, CoreLogic's research director.
Still, the national housing market was fractured with the annual change in housing values ranging from a 15.2% surge in Perth to a 1.6% fall across regional Victoria, the data showed.
In Perth, Adelaide and Brisbane, housing affordability challenges haven't been as pressing relative to the larger cities of Sydney and Melbourne, Lawless said.
Write to James Glynn at james.glynn@wsj.com
(END) Dow Jones Newswires
01-01-24 1923ET
