Money Annual house price growth in Sydney is now falling in real terms

12:25  13 february  2018
12:25  13 february  2018 Source:   businessinsider.com.au

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With prices going backwards in Sydney , it saw annual price growth in the city slow to just 0.7% in nominal terms . Taking into account inflation over the same period, prices in Sydney have now fallen over the past year.

With prices going backwards in Sydney , it saw annual price growth in the city slow to just 0.7% in nominal terms . Taking into account inflation over the same period, prices in Sydney have now fallen over the past year. Like the price movements recorded in Sydney during the week

  Annual house price growth in Sydney is now falling in real terms © Shutterstock Residential property prices continue to fall in Sydney.

According to CoreLogic, prices in Australia's largest and most expensive housing market fell by a further 0.2% last week, extending the losses over the past month to 1%.

The continued weakness came despite a noticeable lift in the city's preliminary auction clearance rate last week, rising to 68.7% from 63.1% a week earlier.

Clearly, one week does not make a trend when it comes to price movements in the city.

With prices going backwards in Sydney, it saw annual price growth in the city slow to just 0.7% in nominal terms.

Taking into account inflation over the same period, prices in Sydney have now fallen over the past year.

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House prices in Sydney and Melbourne are heading for falls , but there’s good news for borrowers. The annual growth rate in the nation’s biggest housing market is now tracking at 3.1 per cent, compared with the peak of the cycle seven months ago when values were rising at an annual rate of

However, the economy is now facing a large transition as the mining investment boom winds down and the terms of trade has fallen back. Overall house price inflation is close to 10 percent, but is around 18 percent in Sydney . Growth outperformance ending. ( Real GDP per capita annual growth , %) 2.

Like the price movements recorded in Sydney during the week, many of the prevailing themes were seen across Australia's remaining four mainland state capitals were also much the same.

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• Annual house price growth slowed for the sixth month in a row. • UK house prices fell by 0.1% in February. Indeed, the unemployment rate has continued to decline and earnings growth has picked up, particularly in inflation-adjusted terms , thanks in part to the sharp decline in energy prices .

Sydney houses prices declined 2 per cent on an annual basis, while apartments still increased 3 per cent. Hobart and Adelaide were the only capital cities recording price growth in February. Nationally, prices fell 0.1 per cent in February, and were up 2.2 per cent over the year.

CoreLogic said prices were flat in all locations, including Melbourne.

a screenshot of a cell phone© Provided by Business Insider Inc

Over the past month, prices in capitals fell, albeit not to the same degree seen in Sydney.

In Melbourne, Adelaide and Perth they fell by 0.2%, with Brisbane the relative outperformer with a decline of only 0.1% reported.

Combined with Sydney's 1% drop, it saw prices nationwide fall by 0.5% in average weighted terms.

Thanks largely to recent weakness in Sydney and Melbourne, price growth over the past year slowed to 2.8%, well below the double-digit percentage increases seen less than one year ago.

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Of the mainland state capitals, prices in Melbourne grew by 7.7% over the year, outpacing gains of 2.4% and 2.1% in Adelaide and Brisbane respectively.

Perth, as has been the case for some time now, saw prices drop by 2.7% over the year.

Reflecting recent price movements across the capitals, the amount of housing stock up for sale continued to increase, rising by 1.1% to 100,659 from the same week a year earlier.

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With price growth in Melbourne also slowing, prices across Australia’s mainland state capitals have fallen by 0.2% over the past month in weighted terms . Listings in Sydney , where prices are now falling , have surged by 20.1% to 26,886 over that period.

Sydney house prices have now fallen 3.1 per cent since the peak of the market in last July, leading to a small 1.3 per cent annual price growth to the end of January.

In Sydney, there were 23,365 residential properties up for sale, up 21.3% on one year earlier. In Melbourne and Canberra, where price growth is also slowing, total stock up for sale increased by a smaller 2.2% and 7.4% respectively.

Outside of the southeastern mainland capitals, the amount of stock up for sale decreased in all other cities, led by a sizeable decline in Hobart which fell by 38.4%.

a screenshot of a cell phone© Provided by Business Insider Inc

In data released last week, CoreLogic found that it took an average of 40 days for a property to sell in Australia's capital cities in December, up from 37 days one year earlier.

In Sydney, Australia’s largest and most expensive housing market where prices are now going backwards, it took an average of 42 days to sell, up sharply from 34 days in December 2016.

While not to the same degree, the average Melbourne sale time also lengthened, rising to 33 days from 29 days 12 months earlier.

In line with other housing market indicators such as house prices, auction clearance rates and housing finance growth, the increase suggests these once-hot markets have cooled over the past year, significantly in the case of Sydney.

CoreLogic said it was reasonable to expect that the number of days it takes to sell a property nationally will trend higher over the year, especially in the southeastern capitals.

“This is likely to occur in Sydney and Melbourne given that both cities have experienced rapid rates of sale and strong growth in dwelling values over recent years,” it said.

“Vendors in those cities were market conditions are softening will need to be realistic about their pricing expectations. As properties take longer to sell, buyers will be more inclined to negotiate on asking prices and vendors may face higher competition from other properties listed for sale as inventory levels rise.”

Danger zones: The 10 Australian suburbs most at risk of falling apartment prices .
Research by property analysts RiskWise Property Review has highlighted specific Australian suburbs where housing investors should be particularly wary about off-the-plan apartment developments.RiskWise focused on suburbs with a combination of low economic growth and excess supply -- the two main drivers of investment under-performance in OTP apartments, they said.

Source: http://au.pressfrom.com/news/money/-55181-annual-house-price-growth-in-sydney-is-now-falling-in-real-terms/

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