Property values across the nation’s capital cities fell almost 2 per cent over May, according to research analysts RP Data-Rismark - the first fall in a year.
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The RP Data research director, Tim Lawless, put the 1.9 per cent decline in the value of capital city dwellings - house and apartments combined - down to both ‘‘seasonality and more moderate housing conditions’’.
The figures show Sydney dwelling values dropped 1.1 per cent, but Melbourne suffered the biggest drop of 3.6 per cent. They fell 1.7 per cent in Brisbane, 1.8 per cent in Adelaide, 0.8 per cent in Perth and 0.6 per cent in Hobart.
Only two cities recorded growth - Darwin was up 1 per cent over the month and Canberra was up 0.1 per cent.
“The month-on-month fall in capital city dwelling values is likely due in part to seasonal phenomenon, but may also be indicative of a broader trend towards cooler housing market conditions,’’ Mr Lawless said.
“Historically, housing market conditions have softened in April and May as the market rebalances from what is typically a seasonally strong first quarter and also as a results of cooler climatic conditions during the autumn and winter months.
‘‘Outside of the seasonality, we have been seeing signs that the housing market is at or approaching the peak of the growth cycle.’’
Mr Lawless said RP Data figures showed the quarterly rate of growth peaked in August last year and auction clearance rates had been weaker.
Yet homebuyers may be surprised to see values falling, given the Sydney and Melbourne auction markets resiliance in the face of a huge number of listings on the weekend.
In Sydney, where there were 900 auctions - the second-biggest number so far this year - the Fairfax-owned Australian Property Monitors said with 568 of the results in by Saturday evening the clearance rate was 78.9 per cent.
In Melbourne, with 903 of the 1165 results in, the clearance was 74.4 per cent.
The Domain senior economist, Dr Andrew Wilson, said in Sydney a record 3411 homes were auctioned for the month of May this year, well ahead of the 1960 auctioned over May last year.
‘‘The 2014 Sydney autumn auction market has smashed all records for this time of the year, clearly recording both the highest number of listings and the highest number of sales,’’ Dr Wilson said.
‘‘Melbourne’s auction clearance rates have averaged 74.1 per cent over the past five weekends from nearly 4456 listings, which was the highest number of auctions ever conducted over May in the metro area.’’
The RP Data Rismark Index shows Sydney’s dwelling values were still up 2.2 per cent over the quarter and up 16.6 per cent over the year. But Melbourne’s quarterly figures were now showing a drop of 1.9 per cent, though up 9.9 per cent over the year. Brisbane dwelling values were up 2.2 per cent over the quarter and 5.8 per cent over the year.
Mr Lawless said with affordability becoming more challenging and rental yields dropping across Australia’s two largest cities, he wouldn’t be surprised if the growth trend moderated further over the year.
Sydney house values fell 1 per cent and apartments 2 per cent over May. Melbourne’s house values fell 3.6 per cent and apartments dropped 3.4 per cent.
Mr Lawless said a recent deterioration in consumer confidence reported in the Westpac/Melbourne Institute Consumer Sentiment Index shows that this factor may also be playing a role in the winding down of housing market conditions.
According to the Index, consumer sentiment recently peaked in September last year and has since declined by 16 per cent. The May consumer sentiment results showed a significant fall away which can be attributed to the announcements made in the recent Federal Government Budget announcement.
| Capital Growth to 31 May 2014 | Sydney | Melbourne | Brisbane - Gold Coast | Adelaide | Perth | Australia 5 capitals (ASX) |
| Table 1A: All Dwellings | ||||||
| Month | -1.1% | -3.6% | -1.3% | -1.8% | -0.8% | -1.9% |
| Quarter | 2.2% | -1.9% | 2.2% | 1.6% | 0.0% | 0.7% |
| Year-to-Date | 3.8% | 1.1% | 1.4% | 1.4% | -1.2% | 1.9% |
| Year on Year | 16.6% | 9.9% | 5.9% | 4.3% | 5.7% | 10.9% |
| Total return Year on Year | 21.5% | 13.9% | 11.0% | 8.9% | 10.4% | 15.5% |
| Median price* | $678,500 | $555,000 | $445,000 | $395,000 | $525,000 | $540,000 |
| Table 1B: Houses | ||||||
| Month | -1.0% | -3.6% | -1.5% | -1.9% | -0.8% | -1.9% |
| Quarter | 2.7% | -1.7% | 2.4% | 1.9% | 0.2% | 0.9% |
| Year-to-Date | 4.5% | 1.6% | 1.4% | 1.5% | -1.3% | 2.2% |
| Year on Year | 18.0% | 10.2% | 6.2% | 4.5% | 5.7% | 11.2% |
| Total return Year on Year | 22.7% | 14.0% | 11.3% | 9.1% | 10.44% | 15.8% |
| Median price* | $800,000 | $612,000 | $482,500 | $415,000 | $544,500 | $575,555 |
| Table 1C: Units | ||||||
| Month | -2.0% | -3.4% | 0.4% | -1.0% | -1.1% | -2.0% |
| Quarter | -0.2% | -3.1% | 1.0% | -1.8% | -2.7% | -1.1% |
| Year-to-Date | 0.6% | -2.6% | 1.7% | 0.8% | 0.1% | -0.1% |
| Year on Year | 10.9% | 7.9% | 2.7% | 1.2% | 5.6% | 8.4% |
| Total return Year on Year | 16.3% | 12.6% | 8.5% | 6.2% | 10.9% | 13.6% |
| Median price* | $576,000 | $468,000 | $370,000 | $330,000 | $445,000 | $473,500 |
| Table 1D: Rental Yield Results | ||||||
| Houses | 3.8% | 3.4% | 4.6% | 4.3% | 4.2% | 3.9% |
| Units | 4.7% | 4.4% | 5.3% | 4.9% | 4.8% | 4.7% |
| Capital Growth to 31 May 2014 | Hobart | Darwin | Canberra | Brisbane | Australia 8 capitals |
| Table 1A: All Dwellings | |||||
| Month | -0.6% | 1.0% | 0.1% | -1.7% | -1.9% |
| Quarter | 0.8% | 5.5% | 1.1% | 2.2% | 0.7% |
| Year-to-Date | 4.2% | 5.0% | 1.0% | 0.9% | 1.9% |
| Year on Year | 1.4% | 9.7% | 2.6% | 5.8% | 10.7% |
| Total return Year on Year | 6.9% | 7.3% | 7.3% | 10.9% | 15.3% |
| Median price* | $345,000 | $560,000 | $520,000 | $448,000 | $545,000 |
| Table 1B: Houses | |||||
| Month | 0.2% | 0.2% | 0.1% | -1.7% | -1.9% |
| Quarter | 0.8% | 6.3% | 1.2% | 2.5% | 0.9% |
| Year-to-Date | 3.7% | 4.6% | 0.9% | 0.9% | 2.2% |
| Year on Year | 1.0% | 9.6% | 2.5% | 6.0% | 11.0% |
| Total return Year on Year | 6.5% | 16.5% | 7.1% | 11.1% | 15.5% |
| Median price* | $370,000 | $590,000 | $560,000 | $470,500 | $575,000 |
| Table 1C: Units | |||||
| Month | -4.6% | 4.7% | 0.5% | -1.2% | -2.1% |
| Quarter | 0.6% | 2.2% | 0.0% | 0.1% | -1.2% |
| Year-to-Date | 9.6% | 6.9% | 2.8% | 1.0% | -0.1% |
| Year on Year | 5.3% | 10.1% | 4.5% | 3.4% | 8.6% |
| Total return Year on Year | 10.9% | 17.1% | 10.1% | 9.3% | 13.8% |
| Median price* | $230,000 | $455,000 | $410,000 | $385,000 | $480,000 |
| Table 1D: Rental Yield Results | |||||
| Houses | 5.2% | 5.8% | 4.3% | 4.6% | 3.9% |
| Units | 5.2% | 5.8% | 5.0% | 5.4% | 4.7% |
*The median price is the middle price of all settled sales over the three months to the end of the final month. Median prices are provided as an indicator of what price a typical home sold for over the most recent quarter. The median price has no direct relationship with the RP Data-Rismark Hedonic Index value. The change in the Index value over time reflects the underlying capital growth rates generated by residential property in the relevant region.
