Home prices keep sliding in Sydney and Melbourne, and now there's a surge in properties for sale

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  • Home prices fell across most Australian mainland state capitals last week, including Sydney and Melbourne.
  • Prices in these cities have now fallen 0.4% over the past 12 months in average weighted terms.
  • There are 112,994 properties listed for sale across Australia’s capital cities, up 8% on 12 month earlier.

Home prices fell across most Australian mainland state capital cities last week, including in Sydney and Melbourne.

According to CoreLogic, prices fell by 0.2% in Melbourne, outpacing a drop of 0.1% in Sydney and Brisbane. With prices flat in Adelaide and Perth over the same period, it left the decline across the five cities at 0.1% in average weighted terms.

Source: CoreLogic

Largely reflecting ongoing declines in Sydney and Melbourne, prices over the month fell 0.3% in weighted terms.

Melbourne, at 0.4%, recorded the steepest decline, outpacing a 0.3% drop in Sydney.

Across the smaller mainland state capitals it was a more mixed performance with prices up slightly in Adelaide, down fractionally in Perth and unchanged in Brisbane.

The weak monthly result points to the likelihood that capital city prices fell again in April when CoreLogic releases its more comprehensive Hedonic Home Value Index on Tuesday.

Despite the mixed monthly performance, prices in all mainland capital cities have now fallen in 2018, ranging from a drop of 2.1% in Sydney to a fall of 0.1% in Brisbane.

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Reflecting those recent trends, and firmer price growth at this point in 2017, prices across these capitals fell by 0.4% over the year in average weighted terms.

That largely reflects a 3.3% slide in Sydney’s median home price over the past 12 months, along with a sharp deceleration in Melbourne with prices now up just 3.8% over the year.

As has been the case for some time, prices fell by 2.3% in Perth in annual terms while those in Brisbane and Adelaide rose by 0.9% over the same period.

Source: CoreLogic

Along with tighter lending standards, affordability constraints and still-weak growth in household incomes, another factor behind the recent price slide is a noticeable increase in properties up for sale.

According to CoreLogic, there are currently 112,994 properties listed for sale across Australia’s capital cities, up 8% on the levels seen 12 month earlier.

New listings — defined as properties that have not been advertised for sale over the past six months — also increased by 10% to 27,593 over the year.

Source: CoreLogic

Much of the national increase in total listings can be explained by just two cities — Sydney and Melbourne — where the number of properties up for sale has risen by 28.2% and 11.4% respectively over the past 12 months to 26,879 and 31,195.

Total listings have also risen in Brisbane, Adelaide and Canberra over the past 12 months, increasing by 1.4%, 1.7% and 6.1% respectively.

In contrast, total listings in Hobart — currently Australia’s hottest housing market in terms of price growth — fell by 30.7% over the year to 1,100.

In Perth and Darwin, where price declines have been slowing in recent months, total listings are also down 3.7% and 0.7% respectively from the levels seen a year ago.

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