The confusion over the strength of the Sydney housing market has hit a whole new level, with Residex releasing its house and unit price results for August, which registered further weakening of growth in Sydney home values, making it diverge even further from the strong growth reported by CoreLogic.
According to Residex, house values nationally fell by 0.86% in August to be up just 0.75% over the quarter and by 6.58% over the year. By comparison, Australian unit values fell by 0.87% in August to be up 1.76% over the quarter and by 2.91% over the year (see below table).
Sydney house prices fell by 0.79% in August to be flat (-0.05%) over the quarter and be up by just 1.19% over the year.
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Melbourne, by contrast, remains the nation’s price growth leader, with house values up by 6.90% in the year to July. Whereas at the other end of the spectrum, Darwin (-6.49%) and Perth (-4.74%) have recorded sizeable annual losses in values.
In this month’s commentary, Residex’s (On-the-House’s) Market Analyst, Eliza Owen, notes that all regions are past their value peak:
When we look at the median house and median unit data over time, it shows that house and unit values are now below their peak in all regions. The magnitude of these declines varies significantly on a region-by-region basis as well as across different property types…
Across the country, median house values are 0.9% lower than their previous peak. In terms of the greatest declines from peak, they have predictably occurred in the regions which have the greatest exposure to the resources sector. Regional Western Australia has been hardest hit with median house values 22.6% lower than they were at their peak. Perth, Darwin and Regional Northern Territory house values have also recorded substantially falls from their respective peaks, down 8.8%, 9.5% and 7.9% respectively.
In all other regions analysed, the decline since the market peak has been less than 5%…
Across most regions of the country median house values have recorded more moderate overall declines than units however, there have been a handful of exceptions. In Sydney, Melbourne, Brisbane and Regional Western Australia, the overall decline in median house values have been greater than median unit value declines.
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Plotting Residex’s latest results at the national capital city level and for Sydney against the other data providers produces the following:
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The divergence between CoreLogic and the other indices is becoming increasingly difficult to ignore or justify.
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
