Sydney’s median home price dropped 0.3 percent over March, CoreLogic data shows
According to analysts, those looking to buy a house must strike now before prices in Sydney’s property market rise again and steadily march upward. Newly released data shows that median home price in Sydney dropped by only 0.3 percent over the last month.
Prices have not been dropping as fast compared to the past seven months, the recently published data shows. Analysts are saying that the current market slump is now bottoming out.
The new figure indicates half the rate of drop over February and only a third of the 0.9 percent falls seen over January and December. Last month’s price drop was also the smallest since the 0.1 percent drop in September when the market’s run of price declines first began.
CoreLogic’s March Hedonic Home Value Index shows that prices across Australia’s capitals dropped for a fifth consecutive month in average weighted terms. That is an increase from a year earlier at only 0.8 percent, well below the recent cyclical peak of 11.4 percent in May last year.
A typical Sydney home now costs around $880,000, down 2.1 percent from almost $900,000 at the same time in 2017. CoreLogic research chief Tim Lawless said the downturn is starting to ease and a return to growth will likely be seen in a few months if existing trends continue. He added that key to the reinvigorated growth rate would be the banks’ decision to reopen their loan books to investors following a period where they were largely shut-out.
AMP Capital chief economist Shane Oliver said the recent national slowdown points to a distinct shift in buyer mentality, specifically in Melbourne and Sydney. “The combination of reduced lending to investors and interest-only borrowers following pressure on the banks last year from APRA to tighten lending standards along with tougher restrictions on foreign buyers, rising supply and more realistic price expectations by buyers are all clearly working to slow the previously booming Sydney and Melbourne residential property markets,” Your Mortgage reports Oliver as saying.
High levels of overseas migration are seen as another huge boost to home prices. Based on ABS figures, New South Wales’ population rose by 123,000 people in the year to September in 2017, mainly driven by the entrance of a record 98,782 overseas migrants. Oliver said a property crash is still unlikely in the absence of higher interest rates, higher unemployment or a continuing surge in supply with population growth staying strong.
