Australian home price slide worsens
Australia’s housing downturn is getting worse, with the more expensive end of the market in Melbourne and Sydney leading the declines.
The price index shows a national capital city price fall of 0.4 per cent during August, with prices down 1.2 per cent over the past three months and nearly 3 per cent over the past year.
Melbourne is now leading the declines, with a 2 per cent fall over the past three months, although Sydney’s 5.6 per cent annual decline is still the worst over the past year.
CoreLogic’s head of research Tim Lawless said there were a range of factors that had slowed the housing market.
“Foremost of which is the tighter credit environment which has slowed market activity, especially amongst investors,” he observed.
“Collectively, these factors have been compounded by affordability challenges, reduced foreign investment and a rise in housing supply.”
Mr Lawless said this slower market activity is showing up in more homes remaining on the market longer.
“Advertised stock levels are already 7.6 per cent higher than the same time last year across the combined capitals, despite a 5.7 per cent reduction in ‘fresh’ stock being added to the market,” he noted in the report.
“The rise in inventory is simply due to a lack of absorption; with fewer buyers, homes are taking longer to sell.”
This trend continued over the weekend, with preliminary auction clearance rates in both Sydney and Melbourne below 60 per cent, pointing to a final clearance rate in the low-50s.
The first reading on clearance rates was only just above 50 per cent in Perth and less than half of properties up for auction sold in Brisbane.