Australia’s most expensive capital city for property has recorded the largest fall in prices in the nation for the December quarter 2015.
Sydney house prices dropped 2.3 per cent over the December quarter after years of being easily the fastest and best performing property market in the land.
Melbourne wasn’t far behind, dropping 1.9 per cent in house prices over the same period.
Brisbane and Adelaide were the two capital cities to record increases in property prices over the quarter, with Brisbane being the best performed with a 1.3 per cent jump.
It has been a steep reversal in form for Australian capital cities in 2015, with the first quarter of 2015 recording a combined increase of 9.3 per cent compared to the December quarter’s poor figures.
Melbourne has gone from a jump in prices of 13.3 per cent in the first quarter to a small fall in the final quarter.
CoreLogic RP Data’s Tim Lawless spoke to Australian Broker.
“In dollar terms, Sydney home owners have seen approximately $82,000 added to their wealth thanks to the strong capital gains over the year while home owners in Melbourne have seen the value of their dwelling grow by approximately $60,400,” he said. “Brisbane home owners are $18,560 better off while Canberra owners have seen the value of their homes increase by approximately $21,900. Home owners in the remaining capital cities have seen some erosion of their wealth via falls in the value of their dwelling.”
“Organic market conditions have been derived from affordability pressures, rental yield compression and cyclical factors, while factors from external influences largely stem from a change in the regulatory framework introduced by APRA which has made it more expensive and difficult for investors to access housing finance. Added to this is higher mortgage rates and more restrictive credit policies and loan servicing requirements.”
Mr Lawless said he thought property prices will continue to decline in Melbourne and Sydney in 2016 but remained optimistic in the strength of the markets in both cities based on strong population growth and healthy economic conditions.
According to Mr Lawless, the best property bargains in Australia this year will be found in Brisbane and the broader South East Queensland region.