Australian house prices have fallen nationwide for the first time in at least 20 months, according to two leading monthly indices.
Key points:
- Both house price indices show a 0.1% drop nationwide in one month
- Both show Sydney, Melbourne and Canberra led the falls
- Adelaide, Brisbane and some regional areas continued to see sharp price rises
Both CoreLogic and REA’s PropTrack indexes put the national monthly drop at around 0.1 percent.
CoreLogic records that it is the first monthly decline since September 2020, while PropTrack predicts it as the first drop since the COVID pandemic began.
CoreLogic reported much larger falls in house prices in Sydney (-1%) and Melbourne (-0.7%), dragging the national average, while PropTrack estimated that both cities fell 0.3% .
Both indices also found that Canberra prices fell last month for the first time in about three years.
Rival data providers also found that price growth remained highest in Adelaide, Brisbane and some regional areas.
CoreLogic’s home value index shows that Australia’s most expensive cities, Sydney, Canberra and Melbourne, are leading the decline. (Provided by: CoreLogic)
“A clear two-speed housing market has emerged,” Paul Ryan of PropTrack said.
“Affordable and lifestyle regions in Brisbane, Adelaide, the NSW region and Tasmania continue to experience solid growth, with flat or falling prices elsewhere.”
The tree change is still attractive
Natasha Di Sano and her husband Daniel moved their family to a new home last month in search of another space to raise their three children.
Natasha Di Sano says moving her family of five and her dog Akira farther from Sydney has allowed them to build a better way of life. (ABC News: Dan Irvine)
“It was my husband who came to me with the idea,” Ms. Di Sano said.
“It was for us to build a better life for both my husband and me and our three children, to give them more of a chance to be in bigger lands, to feel free to be themselves, so as if to give us the opportunity to Live a different lifestyle, not so much of the fast pace “.
Although technically not a regional move, they sold their home, in 500 square meters in the suburbs of Kellyville Ridge, northwest of Sydney, about 40 miles from the CBD, and moved about twice as much. away from the city in Kurrajong. where his three children now have two and a half acres to run.
The new home of the Di Sano family is on 20 times more land than their old home, with a mortgage that is about the same amount. (ABC News: Dan Irvine)
In addition to the extra land and 16 chickens, her new home has more bedrooms and living areas, as well as a grandma’s apartment.
“We haven’t reduced the loan as much as I guess we would like, it’s more or less like we’ve made an exchange,” he said.
“We were really taking advantage of the hot market.”
After the Reserve Bank raised the official interest rate last month for the first time in 11 years, Ms. Di Sano is preparing for further increases and is now taking steps to offset the increase in mortgage repayments.
“Daniel and I are making a very, very tight budget so we can put in a little more … as a shock absorber for these difficult times, which I’m sure are on the way,” he added.
CoreLogic’s director of research, Tim Lawless, said rising interest rates were just one of the factors holding back a slowing real estate market, where price growth peaked in May 2021.
“Since then, housing has become more inaccessible, households have become increasingly sensitive to higher interest rates as debt levels have risen, savings have been reduced. and the terms of the loan have been tightened, “he said.
“We are now also seeing high inflation and a higher cost of debt flowing into lower housing demand.”
However, Lawless said some regional markets may be less vulnerable to falling prices, at least in the short term.
“Given that we are already seeing a slowdown in growth in most regional markets, we are likely to see growth conditions soften in line with higher interest rates and worsen accessibility, “he said.
“Perhaps some regional markets will be somewhat isolated from a material fall in house values due to a continuing imbalance between supply and demand, as we continue to see the announced stock levels remain extraordinarily low in the Australian region “.