Australia has recorded its largest decline in property values on record, with values dropping by 7.9 per cent in a year and the median value of dwellings in more than 200 suburbs dipping below $1 million.
That is according to the latest CoreLogic data, which shows Sydney recorded the largest decline in values for houses and units, at 13.4 per cent.
Meanwhile, values in Melbourne dropped by 9.6 per cent, fell by 11.6 per cent in Hobart, 6.8 per cent in Brisbane and 6.7 per cent in Canberra over the year to February.
Over the past year values have risen by 5.1 per cent in Adelaide, 2.4 per cent in Perth and 2.9 per cent in Darwin.
The Sydney suburb of Bayview recorded the largest drop in value among the suburbs where the median value is above $1 million, with prices slipping by 25.8 per cent in a year which equates to $765,171.
On the other hand, the South Australian suburb of Somerton Park recorded the greatest growth in prices, among suburbs with a median price of more than $1 million, with values increasing by 10.1 per cent or $103,745.
CoreLogic research director Tim Lawless said the shift showed how sensitive the market was to changes in the environment, monetary policy, credit policy and affordability.
"A lot of these areas that went through spectacular growth are going through equally spectacular decline," Mr Lawless said.
When it comes to renting, CoreLogic data shows the most rapid annual rise is evident in units across Sydney, Melbourne and Brisbane, with rents increasing by about 14 to 17 per cent annually.
Across Australia, the annual rise has held steady at 10.1 per cent after a record high of 10.2 per cent in the 12 months to December.
Median value drops below $1m in 226 suburbs
Since this time last year, the median value of dwellings has dropped below $1 million in 226 suburbs across the country.
On the other hand, the median values in 10 suburbs across Perth, Adelaide and NSW rose to more than $1 million.
Mr Lawless said it was interesting that some of the largest drops in value were in regional areas, including Illawarra and on the Central Coast.
"It looks like the areas that are losing million-dollar suburbs seem to be the ones that saw the biggest gain in the upswing," he said.
"A lot of those areas overshot the mark in terms of fair value and they are coming back to something more reasonable."
Sydney has the highest portion of suburbs with a median value above $1 million in 315 of the 615 suburbs analysed.
This has dropped from 399 suburbs with a median value of dwellings above $1 million in 2022.
In Melbourne, the median value of dwellings is above $1 million in 100 of the 392 suburbs analysed which is a drop from 144 last year.
The median value for a dwelling is above $1 million in 40 of the 338 Brisbane suburbs CoreLogic analysed, which is down from 65 suburbs in 2022.
The median value is above $1 million in 59 of the 325 suburbs in Adelaide, 44 of 296 suburbs in Perth and 27 of 99 suburbs in ACT.
Mr Lawless said that while values were dropping it did not equate to dwellings being "extremely affordable" on account of the recent rises.
Sydney bucks trend in February
The monthly pace of decline in home values slowed over February to 0.1 per cent, the data shows.
According to CoreLogic, Sydney was the only Australian capital city to record an increase in dwelling values in February with a rise of 0.3 per cent.
Median prices in February in Sydney crept back up to $1,006,923 after dropping to $999,278 in January.
Melbourne's median price of $746,468 in January fell to $743,554 in February, while Brisbane slid from $698,204 in January to $694,495 last month.
But CoreLogic stressed the importance of putting the recent declines into perspective, given the record upswing of values during the pandemic.
The fall in median prices has coincided with a downturn in capital city dwelling sales.
CoreLogic estimates that in the 12 months to February, there were 486,620 sales nationally, down 21.2 per cent compared to the previous year.
At the national level, properties are taking longer to sell.
In the three months to February, the median days on market was 41, up from a low of 20 days in the three months to November 2021.
$1 million Sydney home a 'bargain'
Anna Porter, of real estate advisors Suburbanite, says that despite a softening of the market over the past year, Australian housing prices remained high.
"One million dollars still doesn't buy you much in Sydney or Melbourne, despite the downward shift in median prices in those cities in recent months," Ms Porter told ABC News.
"Even the Canberra market was crossing the $1 million mark in terms of median prices for a house at the peak of the market last year."
Sydney-based Ms Porter said that high prices in her hometown made it difficult for first-time buyers to enter the market.
"In Sydney, around $1 million is what you'll be paying for a home unit in premium locations," she said.
"If you're buying a house at that price, it's likely to be a bargain buy that needs a lot of work or it may be on the outer fringes of the metropolitan area."
Ms Porter said she expected housing prices to continue to soften.
"We've moved from a sellers' market to a buyers' market, with buyers a lot more cautious and discerning," she said.
"As we're anticipating more interest rate rises, there will be more downward pressure. Even smaller capital cities like Adelaide and Perth that haven't been affected much so far, may start to feel the pinch."
