Sydney strength drags along slowing house prices: APM
While the national median house price was up by 1.2% for the September quarter, it was largely due to Sydney's price growth, according to Australian Property Monitors PriceFinder data.
Domain Group senior economist Andrew Wilson said the national result, the lowest since March 2013, was bolstered by Sydney's performance.
House prices were down in Brisbane, Adelaide, Perth, Canberra and Hobart (click to open in new window).
Source: Australian Property Monitors.
"Surprisingly, the Brisbane house price stalled over the September quarter with the median down by 1.3% which is the first negative quarterly result for more than two years," Wilson said. Brisbane's median house price now sits at $473,924.
"Adelaide and Hobart also reversed recent trends of house price growth, recording their first falls in a year."
Perth's median house price decreased by 1.5% in the quarter to $604,882.
"Subdued prices growth in Perth was no real surprise as that market has consistently reported waning buyer activity over the past year," said Wilson.
Canberra's dropped by 1.7%, from $583,473 to $573,326.
The results were mixed for the three cities where house prices increased for the quarter: Melbourne, Sydney and Darwin. While Darwin's house prices were up by 2.9%, Melbourne saw softer growth of just 1%, the weakest growth result recorded by APM Pricefinder for two years.
Source: Australian Property Monitors.
"Price growth in Melbourne is clearly trending downwards with declining market energy also confirmed recently by falling auction clearance rates and home loans," explained Wilson.
"An underperforming local economy is increasingly providing an impediment to housing market activity and unemployment is tracking at 12-year highs."
Sydney's median house price increased by 3.8% for the quarter to $843,994. The September quarter price is up 16.6% on a yearly basis.
"Although house prices in Sydney are not accelerating at the exceptional levels recorded last year, the growth rate has been consistent over 2014.
"The Sydney market will continue to lead the pack, however, the clock is now ticking for that market as further signs of moderation are emerging," he said.
"The still solid local economy is a key factor behind Sydney's price growth, however, recent signs of continuing moderation in the market are emerging as affordability barriers and low incomes growth constrain buyer activity," Wilson noted.
"Auction clearance rates have fallen and ABS home loan data indicates that although activity remains solid to strong, growth rates are diminishing - particularly from investors who nonetheless remain significant contributors to market activity."
Unit prices fell in every capital city but Sydney and Adelaide, where a 1.6% price increase and a 0.3% rise were recorded respectively.
"Without a sustained revival in economic activity, housing markets will continue to soften, ending the debate about macro-prudential tools or changes to property taxation policy designed to offset local and foreign investor activity," said Wilson.
