According to CoreLogic head of research Tim Lawless, the June housing market results present an early sign that lower mortgage rates and improved sentiment are already having a flow-on effect for housing market conditions in Sydney and Melbourne, while most other regions of Australia continue to show relatively soft housing market outcomes.
National housing market conditions continued to improve through June, with CoreLogic reporting a 0.2% fall in national dwelling values; the smallest month-on-month decline in the national series since March 2018.
“The subtle rate of decline was heavily influenced by trends across Sydney and Melbourne where the pace of falling home values has been consistently reducing over the year to date. Importantly, the improving conditions through to mid-May were largely ‘organic’, pre-dating the positive boost in sentiment following the federal election and interest rate cuts in early June,” Tim Lawless said.
Sydney and Melbourne dwelling values recorded a slight rise in June, up 0.1% and 0.2% respectively, and was the first monthly increase in Sydney housing values since the market peak in July 2017. Melbourne dwelling values haven’t risen since the market moved through a peak in November 2017.
The only other regions to record a rise in housing values over the month were Hobart (+0.2%), as well as the regional areas of South Australia (+0.1%) and Northern Territory (+0.2%)
On a quarterly basis, every capital city housing market has recorded a drop in value, highlighting the broad geographic scope of this housing market downturn. The largest falls over the past three months were recorded in Darwin (-3.6%) and Perth (-2.1%) where the weaker trend has persisted since mid-2014. Adelaide recorded the smallest decline amongst the capitals over the quarter, with values down 0.4%.
Across the regional markets, values were 0.4% lower over the month to be down 3.1% for the financial year. Dwelling values recorded a rise over the June quarter in Regional South Australia (+0.6%) and Regional Tasmania (+1.3%). Although these areas have recorded modest gains over the quarter, the trend across the regional areas of Australia is generally one that is losing momentum.