Australian house price growth cooled last week as auction clearance rates slowed

Oli Scarff/Getty Images

House price growth in Australia’s two major markets slowed in the last week of July, according to CoreLogic’s weekly house price data, released today.

On an average weighted basis, house prices in Sydney fell by 0.3% for the week, which reduced the monthly price change to just 0.9%.

Melbourne prices also dipped by 0.1% for the week, resulting in a monthly change of 2.7%. Prices in Brisbane and Perth also fell, while Adelaide recorded a 0.3% gain.

The results reduced the combined monthly increase of the five capital cities to 1.1%, down from a 2.2% rise a week earlier which was driven by gains of 2.1% and 4.2% in Sydney and Melbourne respectively.

Here’s the latest weekly table from CoreLogic:

Source: CoreLogic

In line with softer weekly house price growth, the preliminary figure for auction clearance rates across the country was 70.7%. That represents a fall from last Monday’s figure of 74.8%.

Preliminary clearances rates are almost certain to be revised down in the Thursday release of the finalised figures, which suggests that the prior week’s national clearance rate of above 70% – the first in two months – is unlikely to be repeated.

The lower clearance rate last week came amid higher auction volumes, with 1,957 auctions across Australia for the week ended 30 July 2017, a 10.6% increase on the week before.

Source: CoreLogic

Clearance rates in Melbourne remained well above the national average, with last week’s 77.2% clearance rate down slightly from the preliminary estimate of 79.4% the week prior.

Sydney’s clearance rate dipped back below 70%, and the preliminary figures of 68% suggests a fall towards 65% may be on the cards when final numbers are released.

As usual, clearance rates differed significantly across the sub-regions of the Sydney market. The eastern suburbs was the only region above 90%, compared to 52.4% in Parramatta and down to 40.4% in the South West region.

The latest data shows gains in the prior week were more of a once-off in July, which was an otherwise softer month for growth after prices bounced back in June.

The property market will be keeping a close eye on August numbers as price growth has shown a slight easing bias since the introduction of macro-prudential regulations in April.