Having in recent years been responsible for driving property price growth in Australia, the city of Sydney is now leading the country’s property downturn.
New figures released by property research data group CoreLogic reveals that prices in the city fell by 0.9 per cent in December alone. This took total price falls in the final quarter of 2017 to 2.1 per cent.
Property prices in Sydney are now already 2.2 per cent lower than they were at the market’s peak in August 2017. The median house price in the city is now AUS$1,058,306, with a median apartment value of AUS$774,124.
And it is estimated that the recent price falls could be just the tip of the iceberg. CoreLogic predictions state that property prices in Australia’s largest city could decrease by up to 10 per cent over the next 12 to 18 months.
“Sydney’s housing market has become the most significant drag on the headline growth figures,” Tim Lawless, CoreLogic’s head of research said.
Lawless expects the market’s slide from “peak to trough” to take 12 to 18 months. “The market peaked in August for Sydney, so we’ve already seen four months of the slowdown,” he explained.
Elsewhere, average state and territory capital city prices were down 0.4 per cent during December. Darwin matched Sydney’s property price falls, also decreasing by 0.9 per cent (the highest in Oz). Melbourne and Perth also recorded price drops during the final month of the year, with prices in those cities falling by 0.2 per cent and 0.1 per cent respectively.
However, Canberra, Adelaide and Hobart’s property markets all saw prices go up in December, with Tasmania’s capital Hobart leading the way with a 1.5 per cent rise in property price growth. Brisbane property prices were stagnant.
While Lawless admits that a slowdown in prices in some of Australia’s biggest cities will lead to slower national growth, he says that prices won’t fall everywhere over the coming year.
“While the headline figures are set to weaken, below the surface the individual cities and regions of Australia will continue to operate under their own distinct cycles which are subject to more localised forces of demand and supply,” he said.
Article published 3rd January 2018