Australia’s housing market downturn has slowed before Christmas, but experts are divided about whether property prices will bottom out in the New Year, or re-accelerate.

CoreLogic’s head of research Eliza Owens said in a new report on Tuesday that property prices are now falling slower, with declines nationally easing from 1.6 per cent in August to 1 per cent in November.

The trend is raising the prospect that the worst of the 2022 property downturn, sparked by sharp rises in interest rates, could be behind us.

“With expectations that the bulk of the rate tightening cycle occurred in 2022, housing values could find a floor in the new year,” Ms Owens said.

Veteran housing economist Andrew Wilson agreed, saying there are signs strength is starting to return to housing markets in some parts of the country after the initial shock of higher interest rates.

“We’ve had a revival in activity, albeit at a slow pace, through Spring,” he said. “The rate of decline of house prices is easing, and clearance rates are starting to push into the 60 per cent results.

“It’s still a buyers’ market, but there are indications it’s tightening up.”

But Ms Owens cautioned that there are a mix of factors affecting property prices, saying that slowing price falls could give way to a re-acceleration in 2023.

“The extent of the floor in values could be further weighed down by mortgage serviceability risks, particularly for those rolling out of record-low fixed mortgage rates through the second half of the year,” she said.

Property prices: Best and worst 2022

CoreLogic published a list of the best and worst performing property markets across Australia on Tuesday, revealing which suburbs have been most resilient to falling prices and which suffered.

The general trend, as detailed in the below tables, is that suburbs in major capitals like Sydney and Melbourne – where prices rose most during the COVID boom – have performed the worst, while smaller capitals like Adelaide have managed to buck the trend.

“Adelaide’s resilience has been a consistent feature of the housing market in 2022,” CoreLogic economist Kaytlin Ezzy said.

“While down 0.9 per cent from the July peak, dwelling values across the city are still 13.4 per cent above the level recorded this time last year.

“Adelaide’s relative affordability and persistently low advertised stock levels have helped insulate it from the worst impacts of rising interest rates.”

Most affordable suburbs heading into 2023

CoreLogic has pulled together a list of the most affordable suburbs across the country heading into 2023.

When property prices are tipped to bottom

Looking forward, CoreLogic doesn’t think that property prices will bottom out until the RBA finishes hiking rates, slated for sometime next year.

But no one knows when, or how many more rate hikes are in between.

“The final paragraph of the December monetary policy statement from the RBA outlined “expected” further increases in the cash rate over the period ahead,” CoreLogic said in its report on Tuesday.

“These recent developments suggest further rate rises through the start of 2023, which is expected to put further downward pressure on property prices until the cash rate peak, expected in early to mid-2023.”