Property prices continue to fall with more to come in 2018
Melbourne and Sydney led with the falls with of 1.4 per cent and 0.9 per cent respectively in the June quarter. Photo: Getty
Housing prices across Australia slipped again last month, with prices continuing to fall since they peaked in September last year.
The clampdown on lending criteria conditions and falling investment levels are the main drivers of the fall, according to the latest report from property industry analysts CoreLogic.
Home prices fell 0.2 per cent in June on a national basis, which marks the ninth consecutive month-on-month drop in values.
National property prices peaked in September 2017 and have since fallen 1.3 per cent to a national median of $556,384.
The weakest performing capital cities were Sydney (-0.9 per cent) and Melbourne (-1.4 per cent) in the past three months, which brought their median (middle) prices down to $870,554 and $716,774 respectively.
Graph shows change in dwelling values in Australia’s capital cities. Image: CoreLogic
But if prospective homebuyers were looking for some kind of solace in the figures, CoreLogic research director Tim Lawless had some sobering news.
Mr Lawless pointed out that dwelling values nationally are still 32.4 per cent higher than they were five years ago.
“This highlights the wealth creation that many home owners have experienced over the recent growth phase, but also the fact that recent home buyers could be facing negative equity,” he said.
And Mr Lawless predicted tighter lending and jittery investors would continue to be factors affecting the market for the rest of the year.
“Tighter finance conditions and less investment activity have been the primary drivers of weaker housing market conditions and don’t see either of these factors relaxing over the second half of 2018.”
The reports showed national dwelling fell by 0.5 per cent in the June quarter, driven by a 0.8 per cent drop in values measured in the eight capital cities.
The larger capital city drop was partially offset by a 0.6 per cent rise in values in the nation’s regional markets.
The largest fall from among the capital cities in the June quarter was Melbourne, with dwelling values down -1.4 per cent, followed by Sydney at -0.9 per cent, Darwin -0.8 per cent and Perth -0.7 per cent.
And it was a case of ‘the bigger they are, the harder they fall’, with the bigger falls coming from the most expensive quarter of the market.
The CoreLogic report found that the most expensive quartile of capital-city properties were down 1.5 per cent in the June quarter, while the least expensive quartile of properties held their ground.
Are the good times slowly coming to an end for Hobart? Photo: Getty
Similarly, over the past 12 months, the most expensive end of the market fell 3.6 per cent, while the least expensive end of the market recorded a 1.4 per cent gain.
Hobart continues to show the strongest capital gain among the capital cities with dwelling values rising a further 2.3 per cent over the past three months, but the pace of growth may be starting to slow.
“Although housing market trends remain very positive across Hobart, the quarterly pace has eased relative to the March quarter when values were up 3.4 per cent,” CoreLogic’s report said.
Values were also up in Adelaide +0.9 per cent, Brisbane +0.3 per cent and Canberra +0.2 per cent over the June quarter.
The regional markets of Victoria have shown the highest rate of capital gain over the June quarter at +1.8 per cent, closely followed by regional Tasmania with +1.7 per cent in the three months to June 30.
