Partly True, But Outdated: Sydney and Melbourne Property Values Did Fall — Then Mostly Bounced Back
“Property values have declined in Sydney and Melbourne”
The argument in brief
The claim that Sydney and Melbourne property values have declined is only half the story. Both cities did fall sharply in 2022-2023, but Sydney has since hit new record highs and Melbourne has partially recovered. The most important detail is the time period: the decline is real history, not the current reality.
Data: ABS Residential Property Price Indexes & CoreLogic HVI
Why it spread
The 2022-2023 property falls were genuinely alarming and widely reported, so the narrative stuck. People under mortgage stress or locked out of the market by high prices had strong emotional reasons to hold onto the idea that values were falling. Negative financial news also travels faster and further than corrections or recoveries, which tend to get quieter coverage.
The claim that property values have declined in Sydney and Melbourne is partially true — but dangerously incomplete. Yes, both cities experienced significant falls from their early 2022 peaks. But for most of 2024, both markets have been in recovery, with Sydney actually surpassing its previous highs. Calling this a decline today is like describing someone as sick after they've already left the hospital.
The numbers are clear. According to the Australian Bureau of Statistics Residential Property Price Indexes, Sydney fell roughly 12-13% from its January 2022 peak to a trough in early 2023. Melbourne dropped around 8-9% over the same stretch. These were real, painful falls — driven by the Reserve Bank of Australia's rapid interest rate hikes, which the RBA's own Financial Stability Review acknowledged as the primary cause.
But the recovery is equally real. CoreLogic's Home Value Index confirms Sydney reached new record highs in late 2023 and continued rising into 2024. PropTrack reported Sydney home prices grew roughly 5-6% across 2023 as a whole. The downturn, while sharp, was relatively short-lived in Sydney's case.
Melbourne is the honest exception. Domain's House Price Report and PropTrack both confirm Melbourne remained below its 2022 peak as of mid-2024, making it one of the weakest-performing capital markets in the country. So if someone is specifically talking about Melbourne and using recent data, there's a kernel of truth worth acknowledging — just not the full picture.
This kind of claim spreads because it gets frozen in time. The 2022-2023 downturn was heavily covered in the media, and negative property news sticks in people's minds. When you hear a striking statistic — Sydney down 13%! — it lodges there even after the situation changes. Always ask: when was this measured, and what has happened since?
Sources
- CoreLogic Home Value Index
After a downturn in 2022-2023, Sydney and Melbourne property values broadly recovered. Sydney reached new record highs in late 2023 and into 2024, while Melbourne experienced more modest recovery and remained below its 2022 peak as of mid-2024.
- Australian Bureau of Statistics – Residential Property Price Indexes
ABS data shows Sydney residential property prices fell approximately 12-13% from their January 2022 peak to their trough in early 2023, before recovering. Melbourne fell roughly 8-9% over the same period. Both cities have seen price growth resume since mid-2023.
- PropTrack Property Market Outlook
PropTrack reported that Sydney home prices rose approximately 5-6% over 2023 as a whole, recovering from the 2022 downturn, while Melbourne lagged behind other capitals with more subdued growth and remained below its peak.
- Domain House Price Report
Domain's reporting confirmed that Melbourne house prices as of late 2023 and into 2024 were still below their 2022 peak, making it one of the weaker-performing capital city markets, while Sydney had largely recovered its losses.
- Reserve Bank of Australia – Financial Stability Review
The RBA noted that the 2022-2023 housing price correction in Sydney and Melbourne was driven by rapid interest rate rises, but that prices stabilised and began recovering in most markets by mid-2023 as demand remained resilient relative to constrained housing supply.