Buying and Selling Corelogic’s home value index shows that the divergence between capital city values and the regions continues, but that the rate of decline eased in February.
Dwelling values declined 0.1% in February, taking housing values 0.8% lower nationally since peaking in September last year. The February fall in values, however, was less than had occurred in in the two preceding months (0.3%) and, for those who are concerned; prices are still actually 2.2% higher over the past 12 months.
Whereas the combined capital city index fell 0.3% over the month, combined regional values climbed 0.4%.
Hobart was the only capital city where the rate of growth didn’t slow and values remained at historic highs. There, dwelling values are up 13.1% over the past 12 months.
Migration underpins demand
Migration rates remained high in February, but New South Wales residents are increasingly moving interstate, particularly to Queensland. This shift in interstate migration trends is easing demand for housing in markets such as Sydney, while demand for property in South East Queensland regions is picking up.
Regional markets outperform capitals
Regional dwelling values continued their upward trajectory in all states but Western Australia, rising by 0.9% over the past quarter.
Regional New South Wales rose by 5.7%, regional Tasmania 5.5%, regional Victoria 4.3%, regional Northern Territory 1.6% and regional Queensland 0.5%. However, for regional South Australia and Western Australia it was the opposite, with values falling 0.1% and 4.7% respectively.
Change in capital city values
Values fell across every capital except Hobart, but the rate of decline eased late in the month, in line with improving auction clearance rates.
Over the three months to February 2018, Adelaide and Hobart were the only capital cities where values rose – 0.1% and 3.2% respectively. Sydney, which has seen the strongest value growth in recent years experienced the largest fall in values – down 2.4%. Darwin, which has continued to adjust in recent years saw a further fall of 2% over the quarter.
First homebuyers support lower end of market
First home buyers have surged back into the New South Wales and Victorian markets, from a borrowing perspective at least, boosted by stamp duty concessions that took effect on July 1. Less competition from investors continues to be the order of the day, despite some lenders reducing rates on investment loans.