Amid 50 years of crises, Australian property prices power on
From the 1970s oil crunch to the 2020s' pandemic, global shocks have repeatedly rattled financial markets, yet over the past five decades property prices have consistently risen in the years following major crises.
‘The times they are a-changing’- yes, these are Bob Dylan’s words from one of his most famous songs.
But they’re resonating on a whole other scale at the moment, with global markets feeling the sentiment closely right now.
The most recent conflict in the Middle East has injected a fresh wave of uncertainty into financial markets.
Share markets are swinging up and down; analysts are debating whether inflation will surge again; and others are speculating about where interest rates might go next.
When the world feels uncertain, investors tend to ask the same question: what does this mean for property?
While no one has a crystal ball, history provides us with a very useful guide.
Over the past 50 years there have been several global crises that shook financial markets and created widespread uncertainty, including:
- the 1973 oil crisis
- Black Monday (19 October 1987)
- dot-com bubble burst and the shock of the September 11, 2001, attacks
- global financial crisis (mid 2007-early 2009)
- Covid pandemic
Each of these events caused major disruption in global markets. Yet Australian property markets told a very different story.
Truth be told, during each of these periods of uncertainty, property values across Australia’s capital cities rose rather than fell.
Here is what happened in the years following each crisis mentioned above:
1973 oil crisis
House prices increased between 34 per cent and 83 per cent across the five major capital cities between 1973 and 1976.
Black Monday (1987)
Prices rose 31 per cent to 77 per cent between 1987 and 1990.
Dotcom bust and 9/11 (2000–2001)
Prices climbed 33 per cent to 67 per cent between 2000 and 2003.
Global financial crisis
Even during the most severe financial shock in modern history, Australian house prices increased 6 per cent to 12 per cent between 2008 and 2011.
For context, during that same period:
- the S&P 500 fell roughly 8 per cent in the United States.
- the S&P/ASX 200 dropped around 30 per cent in Australia.
COVID-19 Pandemic
House prices surged 14 per cent to 52 per cent between 2020 and 2023.
The resilient investment asset
Across five decades of global shocks, when looking at the pattern, it is remarkably consistent: when uncertainty rises, Australian property has historically held firm and often accelerated.
Why is this? Well, it’s because during uncertain times investors tend to move capital away from volatile assets and toward tangible, income-producing assets.
Property sits squarely in that category.
The lesson is simple. Periods of uncertainty often feel uncomfortable, but historically they have not been a threat to Australian property values.
In many cases, it has been the opposite.
So, if there’s one thing I can say to you, it’s that if current global events are making you nervous about our markets, as Bob Dylan said, the times they are a-changing.
But one thing has remained remarkably consistent for decades – Australian houses have proven to be one of the most resilient places to store wealth.
