Australian housing’s poor April

By Leith van Onselen

RP Data-Rismark this morning released its daily home price indices for 30 April, which revealed that Australian capital city home values recorded a -0.73% fall over the month – the largest decline since January 2012 (-0.97%) and breaking two consecutive months of rises (+0.68% in February and +0.18% in March).

The below table summarises the end-April home value indices as well as the rolling quarterly and annual changes:

And below are charts summarising the pertinent movements by capital city and at the 5-capital city aggregate level.

First, the movement in home values over the month of April:

As you can see, value losses were broad-based, with all major capitals except Adelaide recording declines over the month, led by Melbourne and Brisbane.

Since the beginning of the year, home values in all capitals, except Sydney, have recorded value declines, with Melbourne and Brisbane again leading the way:

Finally, in the 12-months to 30 April 2012, home values have fallen across all of Australia’s major capitals with, you guessed it, Melbourne and Brisbane again leading the declines:

I’ll be back with a more detailed wrap when RP Data-Rismark releases its monthly update later in the week. But for now at least, it looks as if the housing ‘slow melt’ continues.

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Comments

  1. But “Residex sees an improving housing market”

    As stated previously on MB, as the numbers go south, fighting between agencies and their methodologies will be interesting to watch…..

    • ceteris paribus

      Yes indeed. It just goes to show that a monthly measure, and perhaps even a three monthly instrument, is too sensitive and unreliable to be applied to house prices. As for a daily measure, I think it absurd. Next someone will want to survey the unemployment number on a daily basis.

      But Leith is on the money with the continuing trend of “slow melt”.

    • Faster still for FHOs who got in over the last couple of years. Mortgaged to their eyeballs, or worse.

      There has to be a lot of negative equity out there, and yet, some builders have the nerve to advertise 100% finance…

  2. Wow Melbourne is looking ill. Granted has hardly undone its 07-10 rise, which was massive.

    Very interested to see the falls from peak for each market

  3. If Melbourne has another month like April its well and truly on, methodology differences or not a down trend like that is hard to argue with.

    • Or it is just a “sideline move of negative growth.”

      For the sake of my life, never ever heard of GROWTH as being negative.

  4. I seem to recall MB charts representing positive changes in blue and negative changes in red in the not too distant past. Now red is used for “5 Capital Cities” and blue is used for the individual markets. Is this coming from RP data or from MB?

    And where is the “Decline from Peak” chart?

  5. Melbourne will reverse the negative trend over the next two months as first home-buyers make the most of Ted’s free money (which ends on 1 July). Coupled with interest rate cuts, I expect to see +1% growth in May and June.

    • Sounds like a reasonable hypothesis to me and likely a correct one. But if in the face of all the first home owners all rushing in to get the grants we see more April like numbers it will get very interesting.

      • I completely disagree. The vast majority of people (probably at least 80%) never see this data and would likely see very little to contradict the matra of property always goes up. This applies almnost doubly to first home buyers who are eager to get into the market before they “miss out forever”.

        $7k on an existing home is alot of money to walk away from for a prospective first home buyer and I dont think very many of them realise that with current falls $7k could be wiped off the value of their newly bought home very quickkly within well the month of April for example if they bought in Melbourne.

        Let me put it this way it seems to me that far more people in Australia know about a Ugandan warlord (Kony) than know anything about falling housing prices in Australia.

        • Remember to the first home buyer that $7k can be levereged. Losing the $7k can push back the FHB $50k of purchasing power. If you don’t think they think like that you not making enough BBQs my friend.

    • I wouldn’t be surprised if you were proven correct. It would be reported as if the bottom had been reached though, which would be most likely incorrect. I expect there may be a bounce of some sort and then further falls.
      Markets don’t move in straight lines as we all know. They bounce around but there is a trend behind it. This trend is pretty obviously heading south.
      I feel sympathy for sellers and IMO it is good if they get to offload property during a bounce but I really hope it is not the most innocent and vulnerable buying, seeking the “comfort and security” of their own home as advocated to them by some wolves in sheep’s clothes.

  6. FYI for anyone who was wondering about the extremely low sales data in January (as previously reported by RP Data) it appears there were missing sales and Tim Lawless has provided the following updates via Twitter:

    TL: Looking at updated transaction data now, Jan sales revised up by 95% (22,720 sales) and Dec up 26% (31,915 sales)

    TL: Dec ’11 sales about 11% higher than Dec ’10 while Jan ’12 slightly lower (-2.1%) than Jan ’11 based on modelling of the data

    BB: Was NSW the driver for Dec sales (FHBs rushing to beat exemption cutoff)?

    TL: Yes, largely attributable to NSW, volume up 16% over Dec qtr ’11 vs Dec qtr ’10 (WA and NT also saw a rise, other states down).