08 Jun Property Market Update May 2018
Nationally values slipped in May by 0.1% which created the first national annual decline since October 2012 according to the latest CoreLogic Hedonic Home Value Index. The report analyses the dwelling values across all regions of Australia. The report highlighted that nationally May’s downturn is is the eight in a row. With both Melbourne and Sydney recording declines of 0.2% and 0.5% last month. Annually shows Melbourne performing stronger than Sydney however the last quarter shows a much weaker performance.
Tim Lawless, CoreLogic’s head of research said “The negative headline growth rate is a
symptom of weakening housing conditions across the capital cities, led by Melbourne and Sydney where previously, capital gains were nation-leading. Sydney and Melbourne comprise approximately 60% of Australia’s housing market by value, and 40% by umber, so the performance of these two cities has a larger effect on the headline market performance.”
Elsewhere in regional markets property prices continued to see rises posting a 2.2% rise annually.
Locally Perth saw a slight decrease in values by 0.1% last month with the quarter ending up slightly by 0.1%, but annually down by 1.8%.
Last week also saw CoreLogic’s Decile report which analyses different levels of the market by dividing it into ten equal groups (deciles) based on their values.
The report analyses changes in values across each decile, the report can identify which parts of the market are over or under performing relative to the headline trends, summarising property market conditions nationally and across each of the capital cities.
Values in Perth have been trending lower since the middle of 2014 and as at April 2018 they were -10.8% lower than their peak. The past three months, values have lifted slightly and are 0.1% higher.
Over the past 12 months, Perth values have fallen by -2.3% which is their most moderate rate of annual decline since May 2015.
Over the three months to April 2018, the 0.1% increase in values was entirely driven by increases across the most affordable and most expensive properties in the city.
This trend is a little counterintuitive given you see recovery trends typically emerge in one segment of the market not two extreme ends of the market.
The largest quarterly decline in values occurred across the 6th decile.
The most expensive properties in Perth was the only sector in which values increased over the past 12 months with the 9th decile recording the most moderate decline, albeit the fall was in excess of 2%.
The 2nd decile recorded the largest decline in values over the past year, with value falls becoming progressively smaller as the typical value of housing rises.
Based on recent quarterly data, values broadly increased in Perth for housing with values below $297,258 and for housing values in excess of $870,181.
Over the past year, housing currently valued in excess of $870,181 broadly saw values rise (moderately) while the greatest declines occurred for housing values between $297,258 and $343,720.
Sources: CoreLogic’s Decile report and CoreLogic’s Hedonic Home Value Index