Prices fell 5.6 percent a year in Sydney and 1.7 percent in Melbourne. (photo by Aussie)
Australian housing prices have fallen for 11 consecutive months, with the housing market generally weak, according to the Australian newspaper. Home prices fell in most state cities, including Melbourne`s worst quarterly decline since 2012.
In August, house prices fell in five of Australia`s eight major government cities, according to the National House Price Index of CoreLogic, a property data analyst, with Melbourne and Perth being the most visible, with a 0.6% drop.
Sydney`s house prices fell 0.3% over the same period. Home prices in the city have fallen 5.6 percent over the past year, the biggest drop in any state-run city and the sharpest drop since March 2009.
Melbourne recorded a 2% quarterly decline in house prices, the biggest three-month decline since January 2012. The city`s annual home price drop was 1.7 percent, the worst since October 2012, when it fell 1.8 percent.
Australian house prices are on a downward trend as regulators tighten bank lending policies and lower buyer activity, and the housing market will remain sluggish.
Kush (Cameron Kusher), a research analyst at CoreLogic, said the housing market was expected to be fairly calm this spring. Sales in Sydney and Melbourne are much higher than they were 12 months ago, and sales are likely to be a bit more active, but he doesn`t think the housing market will be particularly strong this spring.
Kush expects other major banks to do the same after Western Pacific and several junior banks raise lending rates, which will further reduce demand for housing. From its peak to underestimation, Australian house prices could fall by about 5 to 10 percent, he said.
In spite of the current decline in house prices, buyers of homes in the early days of the boom have all reaped strong growth in value. In the five years to the peak of last year`s housing market, house prices rose 72.7% in Sydney and 57.1% in Melbourne.
It is unlikely that there will be such strong house price growth in the next few years, but investment prospects outside Sydney and Melbourne are relatively good, with higher rates of return on rents.
Across Australia, home prices fell 0.2 percent in August in Brisbane, 0.1 percent in Hobart, 0.1 percent in Darwin, 0.3 percent in Adelaide and 0.5 percent in Canberra.
