The current figures are showing that the prices for the national median houses in capital cities of Australia fell 0.3% in December 2017. This sign of cooling in the property market is supposed to remain in the same condition throughout 2018. The data from group CoreLogic show has pointed out a major fall down in prices of houses in cities like Sydney and Darwin. This has also spread to Melbourne and Perth.
The foreshock received before this condition:
This fall in the property market has resulted from the growth of national home price in the previous years. The price rose to 4.2% in 2017 which can be compared with the price rise in the year 2016 with 5.8% and in 2015 with 9.2%.
In this context, the head of the research, Tim Lawless has mentioned that the change witnessed in the weaker housing markets of Australia which was slow but gradual is surely manipulated by capital cities. He has stated that the housing market of Sidney is the most significant manipulator of headline growth figures.
The changes in values compared to past years:
The dwelling prices of Sidney have decreased 0.9% in December 2017 which is again hoped to be lowered down by 2.1% in the quarter. Lawless has added his valuable statement in this context saying that there is a visible and remarkable change in the growth of the city’s annual rate. This annual rate is currently situated at 3.1% which presents an astonishing difference compared to the growth of the city’s annual rate which was 17.1% only seven months ago.
The values of the houses fell for the first time after February 2016 in Melbourne in December 2017 with the decrease of dwelling values with 0.2%. The housing market in Melbourne was much more resistant to the negative impact as compared to Sydney. Lawless mentioned the causes of this fact saying that this city had always borne large population, growth in the job market and also fewer troubles in the affordability of houses.
Hobart had also received a growth in the property market and performed its best in the year 2017 with the price rising of 12.3%. It was proven to be five times higher than the average capital gain for a decade. But even so, the CoreLogic data says that the houses of this city still remained much less costly than other major cities of Australia.
The expectations for the future:
After finding such results, Lawless mentions that he had expected that the previous phase in the housing market will be softened by tighter credit policies. He also mentions that the strategies of the housing market in 2017 were nearly similar to the previous years. In the year 2015 and 2016, a major impact was witnessed with the macro-prudential measures announced by the Australian Prudential Regulation Authority and it affected the credits of investment necessities.
The negative growth in the housing market of Australia resulted from the previous years is likely to be softened with the positive growth rates in the strong housing markets of the major cities first. The effects are also going to be found in the investments in real estates, credit standards and also buyers in other cities of Australia.