A trend-cycle analysis of the evolutionary trajectory of Australian housing prices

Document Type

Journal Article

Publication Title

Journal of Property Research

Publisher

Taylor & Francis

School

School of Science

RAS ID

76577

Comments

Osei, P. M., Lo, J., Mueller, U., Richardson, S., & Afrifa-Yamoah, E. (2025). A trend-cycle analysis of the evolutionary trajectory of Australian housing prices. Journal of Property Research. Advance online publication. https://doi.org/10.1080/09599916.2024.2444884

Abstract

Time-frequency domain analysis of housing prices can provide insights into significant periodic patterns in the pricing dynamics for modelling and forecasting purposes. This study applied wavelet and information entropy analyses to examine the periodic patterns and evolution of housing prices in Australia’s eight capital cities from 1980 to 2023, using quarterly median house pricing data. Our findings revealed consistent patterns of higher variability in housing prices at high frequencies across all cities, with Melbourne exhibiting the highest variability. This indicates that short-term price fluctuations were higher than long-term changes. Perth and Brisbane demonstrated notable cyclical patterns with recurring periods of growth and decline. Coherence analyses revealed dynamic lead–lag relationships, both positive and negative, between housing prices of various cities, suggesting interconnectedness but not always synchronisation. Some cities’ housing prices dominated the information sharing, indicating varying degrees of influence within the national market. These findings highlight the complex, dynamic interdependencies among Australia’s major city housing markets, providing valuable insights for policymakers, investors, and stakeholders in economic forecasting, policy development and strategic planning within these markets.

DOI

10.1080/09599916.2024.2444884

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