Sydney was the only city in Australia where house prices fell last week

Photo by Quinn Rooney/Getty Images

Sydney was the only property market to fall last week across Australia’s five largest capital cities.

Weekly data from CoreLogic showed Sydney house prices fell by 0.3%, with flat growth in Melbourne, Brisbane, Adelaide and Perth.

The relative weight of the Sydney market saw prices nationally dragged lower by 0.2% over the week, amid lower auction volumes coming into the end of the year:

Last week’s decline in Sydney left annual price growth at 3.4% — down from 3.8% in the previous week.

Flat price growth in Melbourne — which is being buffeted for now by stronger population growth and slightly higher affordability — left the annual rate of growth at 9.1% — consistent with the previous week.

The weekly price action was achieved as auction clearance rates in Sydney and Melbourne edged higher from their 2017 lows in the previous week, amid reduced volume as less properties were brought to market.

“The number of homes taken to auction fell this week, after the surge in activity recorded over the 4 weeks prior when volumes remained consistently above the 3,000 level,” CoreLogic said.

“There were a total of 2,865 auctions held this week, down on last week when 3,371 auctions where held across the capitals and only slightly higher than volumes from the same week one year ago (2,735).”

Based on recent performance, Sydney’s preliminary clearance rate of 60.8% indicates a final clearance rate closer to 55%, which historically has been a level associated with price falls in the Sydney market.

The figures show Sydney house prices continue to lead the national market lower into the end of the year, as macro-prudential restrictions on investor lending take effect.

Research from UBS last week suggested that further macro-prudential restrictions may be forthcoming, as regulators focus on the accuracy of living expenses in mortgage applications.

Across Australia’s other largest capitals, flat weekly growth left annual rates of growth largely consistent with the prior week.

Amid signs that Perth’s housing market has reached its cyclical trough, prices are up 0.3% over the month although still 2% lower in annual terms.

Annual price growth in Brisbane was unchanged, while prices in Adelaide edged higher to 2.9% from 2.8% in the week prior.

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