Geelong home prices fell marginally in June as buyers became nervous.
Geelong home prices have cooled again amid a further market slowdown but the city is proving more resilient than many other places across Victoria.
PropTrack Home Price Index data shows the median dwelling value fell slightly to $768,000 in June as the latest interest rate rise and the property tax shake-up started to bite.
Buyers’ jitters contributed to a 0.12 per cent drop in the typical house price, which dropped to $806,000, with units taking a slightly harder hit.
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Overall, dwelling prices slid 0.23 per cent, or almost $1800.
The June index is the first full month of data released since the Federal Government unveiled reforms restricting negative gearing for residential property to new builds from July 1 2027.
REA Group senior economist Anne Flaherty said house prices were weaker nationally in the wake of the changes, though regional markets fared better than capital cities.
She said Geelong home prices, in particular, were still well up on the same time last year.
“What we are seeing is that actually Geelong has outperformed the rest of the state marginally over June,” Ms Flaherty said.
“Prices in Greater Melbourne fell by 0.4 per cent, in Geelong they were down by 0.2 per cent, so around half the magnitude of the fall seen in Melbourne and actually in contrast to Greater Melbourne, which has seen prices down year-on-year by 1.1 per cent, in Geelong they are still up 2.6 per cent compared to a year ago.”
REA group senior economist and June Home Price Index report author Anne Flaherty.
She said while the full impact of the budget on investor demand remained to be seen, there was a “strong chance” values would slide further.
“We have seen buyers quite nervous because of the changes from the budget and also there’s uncertainty around interest rates,” she said.
“We might see interest rates rise another time before the end of the year and from a buyers’ perspective, if they are anticipating that home prices are going to continue to decline over the coming months they may look to wait, depending on their circumstances.”
McGrath, Geelong director Jim Cross said market conditions had been challenging in Victoria for 18 months.
This four-bedroom house at 11 Clearwater Grove, Highton recently sold for $1.355m.
But he said with consecutive interest rate rises now putting the brakes on growth in other states, buyers could start to return.
“We are expecting that it will go full circle. I’ve been through five property cycles now and Victoria at the moment is seen to be undervalued compared to the rest of the country,” Mr Cross said.
“Often on the back of that you see a rotation of people coming back to Victoria.”
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