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The nation's top medical chief has branded new travel requirements for people from China as unnecessary and inconsistent with Australia's COVID-19 management.

People travelling to Australia from China, Hong Kong or Macau will need to test negative within 48 hours of departure from Thursday.

People transiting through will not be affected and those who test positive after arriving in Australia will need to follow the local health advice, including the recommendation to isolate while symptomatic.

Chief Medical Officer Paul Kelly advised the health minister on December 31 mandatory testing was "disproportionate to the risk" given Australia's high vaccination rates, ready access to treatment for vulnerable people and the lesser risk of transmission in summer.

"I don't believe there is sufficient public health rationale to impose any restriction or additional requirements on travellers from China," he wrote.

Professor Kelly suggested testing plane wastewater, voluntary sampling of arrivals, an increase in community wastewater testing and following up with returned overseas travellers who tested positive for the virus.

Health Minister Mark Butler said while there was no evidence of an imminent threat to Australia, he made the decision out of "an abundance of caution" and to be able to quickly detect and assess any new strains.

He cited the World Health Organisation's call for more data out of China to ensure authorities were able to quickly detect any new COVID-19 variants, and maintained the measure was modest.

"This is a very fast-moving situation and we've seen countries right around the world take the decision I have a couple of days ago," he told Adelaide radio station 5AA.

Mr Butler said similar measures will not be put in place for travellers from other countries such as the United States due to the timely reporting of information and genomic sequencing data.

Opposition leader Peter Dutton said the government needed to explain why they went against the health advice when there was no new variant of concern coming from China.

"In the absence of Australian health advice to put the restrictions in place, the prime minister must justify why he has deviated from what has been previously agreed," he said.

Beijing recently scrapped strict "zero-COVID" measures in favour of a new policy of living with the virus, which resulted in an eruption of infections and the prediction of three winter waves.

Treasurer Jim Chalmers said Australia already had a big enough challenge managing COVID "without unnecessarily exposing ourselves to a part of the world that's got an extraordinarily large wave right now".

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Australia's property downturn has picked up pace again but Melbourne is the only capital city getting close to erasing the entirety of its pandemic upswing.

Home prices plummeted another 1.1 per cent in December, CoreLogic data shows, amounting to a 5.3 per cent total decline in 12 months.

The notable drop follows a few months of more moderate falls in September and November.

The annual decline is the fastest since the global financial crisis, when home values fell 6.4 per cent in 2008.

While rising interest rates are driving a sharp correction in the housing market, home prices overall are still well above pre-COVID levels.

Dwelling values are still up 11.7 per cent across the combined capitals and 32.2 per cent across regional markets compared to March 2020.

But in Melbourne, dwelling values are now only 1.5 per cent above March 2020 levels, unwinding most of the COVID gains.

"The relatively small difference between March 2020 and December 2022 levels can be attributed to a number of factors, including a larger drop in values during the early phase of COVID, a milder upswing through the growth cycle and the -8.3 per cent drop since values peaked in February," CoreLogic research director Tim Lawless said.

Melbourne also helped pull down the indicator for the month of December, with home prices falling 1.2 per cent over the month.

Adelaide, by contrast, has only fallen 1.5 per cent from its peak, and dwelling values remain 42.8 per cent above pre-COVID levels.

Another source of residential property data, PropTrack's home price index, recorded a more subdued 0.21 percentage point decline over the month.

Prices are down 2.29 per cent over the 12 months, according to the property research firm, with interest rate rises eroding the amount buyers can borrow.

PropTrack economist and report author Anne Flaherty said prices would likely keep falling into 2023.

"While interest rates are likely to be approaching their peak, the Reserve Bank has signalled the potential for more increases in 2023," Ms Flaherty said.

"Higher interest rates would further erode borrowing capacities and drive prices lower."

The series of eight rate rises in a row has already reduced borrowing capacity by around 25 per cent.

AMP Capital economist Shane Oliver said home values were likely to keep falling into the September quarter as rate hikes flowed through and economic conditions deteriorated.

While he said the cash rate was close to its peak, he said the upcoming fixed mortgage cliff - which will see mortgage holders bumped onto much higher variable rate home loans when their fixed rates expire - will ramp up housing stress.

Together with the likely uptick in unemployment as the economy slows, Dr Oliver said demand for housing could weaken and supply could increase as financially stressed home owners sell up.

Under this scenario, he expects a top to bottom fall of 15 to 20 per cent to around the September quarter.

But possible rate cuts later in the year are likely to lift prices by the December quarter, Dr Oliver said.

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Australia doesn't need to impose additional travel requirements for people coming from China because domestic vaccination rates and local surveillance systems are strong, the chief medical officer says.

The Albanese government moved on New Years Day to require people travelling from China to test negative for COVID-19 within 48 hours of departure.

From Thursday, passengers who board flights in China, Hong Kong or Macau that arrive in Australia will need a negative test, while those transiting through will not be affected.

Those who test positive after arriving in Australia will need to follow the local health advice, including the recommendation to isolate while symptomatic.

In a letter to the health minister, dated December 31, Professor Paul Kelly said any additional measures on Chinese travellers would be "inconsistent with the current national approach to the management of COVID-19 and disproportionate to the risk".

Prof Kelly recommended the government consider enhancing surveillance capabilities, especially for international arrivals.

Suggested measures included testing plane wastewater, voluntary sampling of arrivals, an increase in community wastewater testing and following up with people who test positive for the virus and had recently returned from overseas.

Health Minister Mark Butler said while there was no evidence of an imminent threat to Australia, he made the decision out of "an abundance of caution".

He cited the need for more data out of China to ensure authorities were able to quickly detect and assess the impact of any new COVID-19 variants and maintained the measure was modest.

"Other countries have expressed concern we don't have information about a very fast-evolving COVID wave in the largest country on the planet," he told Adelaide radio station 5AA.

Mr Butler said similar measures will not be put in place for travellers from other countries such as the United States due to the timely reporting of information and genomic sequencing data.

Mr Butler said the World Health Organisation describing an absence of information from China formed part of his considerations to pull the trigger.

"We're just ensuring we've got the most information we can possibly get to protect the health of Australians," he said.

Beijing last month announced it was scrapping strict "zero-COVID" measures in favour of a new policy of living with the virus.

A wave of infections has since erupted across China after borders had been kept all but shut for three years amid a strict regime of lockdowns and relentless testing.

Prof Kelly acknowledged in his advice that experts in China are predicting three winter waves of COVID transmission with the current event expected to run until mid-January, followed by two waves in late January and late February to early March.

Infectious disease expert Robert Booy agreed with the government's decision, saying the health minister was correct to say better surveillance was needed.

"The potential for a new subvariant is truly there in China, with tens of millions getting infected," Professor Booy told Seven's Sunrise program.

"You're damned if you do and you're damned if you don't. They've made a reasonable choice."

Opposition assistant health spokeswoman Melissa McIntosh questioned why the government would pull the trigger without the health advice recommending to do so.

"Why would you have the chief medical officer say one thing, and the government ignore that and do another?" she told ABC TV.

Treasurer Jim Chalmers said the government always made decisions in the best interests of the nation and took into consideration the actions of other countries.

The US, UK, France, India, Japan, Spain and South Korea have all imposed similar testing measures on arrivals from China.

China also requires travellers to produce a negative COVID test.

"We've already got a big enough challenge here managing COVID without unnecessarily exposing ourselves to part of the world that's got an extraordinarily large wave right now," Dr Chalmers told ABC radio.

"We take the medical advice seriously."

© AAP 2023