Yahoo Finance Sydney home prices FALL for first time in 17 months
Home prices continued to rise across the country in February, but one major market saw its first fall since September 2020.
The Sydney housing market fell 0.1 per cent in February while Melbourne’s market was completely unchanged during the month, leading some to suspect the property boom may be over.
CoreLogic’s national Home Value Index shows property values across the board increased 0.6 per cent in February, but the pace of growth has been slowing since April last year.
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February’s growth of 0.6 per cent marks the lowest monthly reading since October 2020 and is down from 1.1 per cent in January and a cyclical peak of 2.8 per cent in March 2021.
According to CoreLogic’s director of research, Tim Lawless, every capital city and broad ‘rest of state’ region is now recording a slowing trend in value growth, albeit with significant diversity.
“Conditions are easing less noticeably across the smaller capitals, especially Brisbane, Adelaide and Hobart, where housing values rose by more than 1 per cent in February,” Lawless said.
“Similarly, regional markets have been somewhat insulated to slowing growth conditions, with five of the six rest-of-state regions continuing to record monthly gains in excess of 1.2 per cent.”
With the trend in housing values losing pace over the past 11 months, the annual growth trend turned in February.
Nationally, home values were 20.6 per cent higher over the past 12 months, down from what is likely to be the peak rate of annual growth recorded at 22.4 per cent last month, CoreLogic said.
Regional Australia continues to record a substantially higher rate of growth than the capital cities.
Over the past three months, housing values across the combined rest-of-state regions increased at more than three times the speed of housing values across the combined capital cities.
“Regional housing markets aren’t immune from the higher cost of debt as fixed-term mortgage rates rise,” Lawless said.
“These markets are also increasingly impacted by worsening affordability constraints as housing prices consistently outpace incomes.”
However, Lawless said, ongoing demand for a sea or tree change was expected to continue to support strong upward price pressures across regional housing markets.
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