CoreLogic’s daily dwelling values index reveals that both Melbourne and Sydney home values continue to soften.
Melbourne dwelling values have fallen by 0.4% over the past 28 days and Sydney’s have risen by a relatively modest 0.2%:
By comparison, values rose by 0.4% at the 5-city aggregate level, driven by strong growth across Perth, Adelaide and Brisbane.
The moderation in Melbourne and Sydney dwelling values has been matched by the auction market, where clearances have drifted lower:
PropTrack has released for sale listings data for July, which shows that total listings across Sydney and Melbourne surged by 17.4% and 21.7% respectively year-on-year, by far the largest rise among the major capitals:
Commenting on the result, PropTrack noted that “the stronger new listings environment has resulted in more choice for buyers” and is “likely a key contributor to slowing home price growth”.
Last week, SQM Research managing director Louis Christopher noted that asking prices in Sydney fell by 1.0% in the month ended 6 August, and declined by 0.9% in Melbourne.
“Asking prices have been a good leading indicator of actual prices, so our expectation is a fall in housing prices for the September quarter”, he said.
“Let’s remember when we started the year, there was a great expectation of a rate cut in the March or June quarter. But that never happened. That’s why confidence sapped”.
Most economists now expect the Reserve Bank of Australia to commence an easing cycle next year. Affordability is also stretched, with median prices and loan sizes at record highs:
It will be interesting to see whether Louis Christopher’s prediction comes true and home values fall this quarter.
