Australian Housing Downturn Deepens with Varied Price Falls Across Capitals

Australia’s housing downturn extended into a seventh consecutive month in October, with national home prices falling 0.3%. Prices are now 4.3% below their March peak and 1.9% lower than a year ago.

Sydney has now overtaken Melbourne as the capital city with the deepest correction from peak. Sydney prices are down 6.7%, compared with Melbourne’s 6.1% decline. Adelaide recorded the largest monthly fall among the capitals in October at 0.6%.

The figures show that the downturn is becoming more widespread rather than being concentrated in Sydney and Melbourne. Brisbane and Perth are also experiencing sustained declines after several years of strong growth.

For Melbourne’s western growth corridor, this is an important reminder that national and capital-city averages only tell part of the story. Local affordability, new housing supply, infrastructure, rental demand and buyer demographics can all influence individual suburbs differently.

Melbourne prices fell only 0.1% in October, a smaller monthly decline than Sydney, Adelaide, Brisbane and Perth. Its relative affordability compared with several other capitals may also provide some support as buyers become more price-conscious.

For buyers, the broader correction may mean more choice and greater negotiating power. However, higher borrowing costs continue to limit purchasing capacity, so cheaper prices do not necessarily translate into easier affordability.

Investors should therefore focus on suburb-level fundamentals rather than assuming every market will follow the same path. Areas with strong rental demand, infrastructure investment and comparatively affordable housing may prove more resilient than broader headline figures suggest.

Overall, the October data confirms that Australia is experiencing a broad market adjustment, but the pace and depth of decline vary significantly by location. For Melbourne’s west, local conditions will remain increasingly important when assessing future opportunities.