- Home prices continue to fall in Australia’s largest cities, maintaining the trend seen throughout 2018.
- Melbourne’s median home price has fallen 4.6% this year, slightly ahead of Sydney where values have declined 4.4%. In contrast, median prices have actually increased in Brisbane and Adelaide since the beginning of the year.
- Total property listings across the capitals have risen 10.2%, leaving them at the highest level since late 2012.
Home prices continue to fall in Australia’s largest cities, mirroring a continued slide in auction clearance rates.
According to CoreLogic, the median home price in Australia’s five mainland capital cities fell 0.2% last week in average weighted terms, largely reflecting continued declines in Sydney and Melbourne where prices fell 0.2% apiece.
Preliminary auction clearance rates in both cities weakened over the same period, coming in just above the 50% level last week.
Perth’s median price also fell 0.2%, helping to mask an unchanged reading in Brisbane and 0.1% increase in Adelaide.
Over the past four weeks the median price in the state capitals dipped 0.6% in weighted terms, driven lower by declines of 0.8%, 0.7% and 0.6% respectively in Melbourne, Perth and Sydney.
Adelaide’s median price fell 0.3% over the same period. Brisbane, at 0.1%, was the only mainland state capital to see median values increase over the month.
Year-to-date, Melbourne continued to lead prices lower nationally with a drop of 4.6%, outpacing falls of 4.4% in Sydney and 3.3% in Perth.
Despite modest gains of 0.3% and 0.5% respectively in Brisbane and Adelaide form the end of last year, that left the average weighted decline in the mainland state capitals at 3.6%.
Melbourne and Sydney contain around 40% of all Australian homes. With prices in these cities higher than the national average, they also comprise around 60% of Australia’s total housing wealth.
Similar results were also reported in price movements over the past year, although Sydney’s median, at 6.3%, has still recorded a larger decline than Melbourne at 4%.
However, the gap between the two is narrowing, indicating that prices in Melbourne have been falling faster than Sydney in recent months.
Perth’s median dipped 3.3% over the year while values in Brisbane and Adelaide rose 0.4% and 0.8% respectively, helping to limit the decline in CoreLogic’s five capital cities measure to 4.3%.
Tighter lending standards towards interest-only and high debt and loan to income borrowers, along with reduced activity from offshore buyers and deterioration in sentiment towards the outlook for prices among households and property experts, has helped to limit demand for property over this period.
And on the supply side of the equation, the total amount of homes listed for sale has increased sharply over the past year, increasing by 10.2% across the capital cities in average weighted terms, according to separate data from CoreLogic.
By individual capital, listings in Sydney and Melbourne have surged by 19.5% and 18.4% over the past 12 months, largely explaining the increase in the national measure.
Total listings have increased by a smaller amount in Brisbane, Perth and Canberra over the year, while those in Adelaide, Darwin and Hobart have fallen by 4.9%, 10.4% and 8.2% respectively.
While total listings have increased nationally over the past year, new listings — defined as those that have not been put up for sale within the past six months — have actually fallen by 3.7% in weighted terms over the same period.
The divergence between new and total listings reflects, from a broad perspective, that it’s now taking longer for the average property to sell once put on the market, reflective of weaker demand.
Softer market conditions are clearly dissuading some prospective vendors from listing their property given ample supply of existing and new dwellings is already on the market.
At 117,759, the total number of capital city listings now sits at the highest level since late 2012.