What’s the outlook for the Australian property markets for 2023 and beyond?
This is a common question people are asking now that the housing markets have transitioned from the once-in-a-generation property boom experienced in 2020 -21 to the adjustment phase of the property cycle that could be best described as multi-speed.
While overall the Australian property market is in a downturn, not all of the nation’s property markets are being impacted equally.
Each State is at its own stage of the property cycle and within each capital city there are multiple markets with property values falling in some locations, and stagnant in others and there are even a few locations where housing values are still rising.

Source: Corelogic 1st December 2022
After recording significantly stronger appreciation through the upswing, the fall in regional dwelling values is catching up with the capital cities.
We’ve moved into this next stage of the property cycle faster than some expected, pulled forward by an earlier and more aggressive interest rate tightening cycle due to the RBA’s response to a surprisingly strong surge in inflation.
While much of this is due to offshore factors that can be expected to ease over time, the high starting point for inflation and tight labour market domestically means the RBA is moving aggressively on interest rates – taking them from COVID ’emergency’ lows to more ‘normal’ levels.
And this has caused many commentators to warn that we are going to have a housing market crash
I don’t think so! And I’ll explain why in a moment, but first, let’s look at what’s really going on in our property market…
What’s currently happening to property values in Australia
The following table shows what happened to dwelling prices around Australia since the pandemic.
As you can see while values in our capital cities grew considerably, the regional property market performed even better during the last property boom.
But now we’re in the adjustment phase of the property cycle and overall property values are 6% lower than their peak.
That’s not a property market crash-is it?
It’s an orderly correction that had to occur after house prices all around Australia got ahead of themselves.