Home prices in Sydney are still falling, continuing the trend that began in late 2017.
According to CoreLogic, prices in Australia’s most largest and most expensive housing market fell by 0.4%, leaving the decline over the past month at 0.6%.
Thanks to the recent slowdown, driven by a combination of tighter lending restrictions on Australian and international investors, affordability constraints and an increase in stock being up for sale, prices growth over the past year slowed to just 1.9%, well below the high-teen percentage growth rates seen in the first half of 2017.
And, as seen in the chart below, the weakness in prices was not isolated to Sydney.
While not to the same degree as Sydney, prices in Melbourne — Australia’s second-largest and second most expensive housing market — also slipped, falling 0.1% from a week earlier.
That trimmed the gain over the past year to 8.4%, less than half the pace in the June quarter last year.
Melbourne too is slowing, just not to the same degree as Sydney, yet.
In contrast, prices in Australia’s remaining mainland state capitals — Brisbane, Perth and Adelaide — were flat over the week. However, given the sheer size of the Sydney and Melbourne markets — national prices still fell by 0.2% in weighted terms.
Over the past year, prices in Brisbane and Adelaide grew by 2.3% and 2.6% respectively. In Perth, prices fell by 2.3% over the same period, a slower pace than that reported in previous months.
Nationally, prices grew by 3.6% in weighted terms.
While there are numerous factors working in tandem to slow price growth, one major reason is a large increase in stock currently for sale, especially in Sydney.
According to CoreLogic, there were 90,514 properties listed last week, up 4.6% from a year earlier.
By specific market, the number of properties up for sale in Sydney currently stands at 19,034, up 29% from a year earlier. Available stock in Melbourne, Brisbane, Adelaide and Canberra is also up 3.2%, 2.6%, 2.1% and 7% respectively from mid-January 2017.
In contrast, the number of properties up for sale in Hobart — currently Australia’s hottest housing market in terms of annual price growth — has fallen by 38.4% over the same period.
In Perth and Darwin — where annual price declines appear to be slowing — stock up for sale has also fallen by 5.1% and 3.5% respectively over the year.