HOUSE prices across every capital city have fallen over the last 12 months to March. According to Australian Property Monitors, Darwin and Melbourne were the only exception where house and unit prices rose.
Melbourne and Darwin are the only capital cities with price rises for both houses and units in the March quarter.
Darwin was by far the strongest market, house prices rose by 1.5% in the March quarter and 6.3% higher over the 12 months. Units jumped 9.3% rise in the quarter to $382,000 and is 19% higher over the year.
In Melbourne, house prices recorded their second consecutive quarter of growth but remain down -0.4% for the 12-months to March. After falling for the last two quarters unit prices recovered slightly, rising +0.5% to $334,000.
APM’s economist Matthew Bell said the March 2009 housing and unit figures show a surprisingly resilient residential property market amidst the global and domestic economic turmoil.
Nationally the median house price was slightly positive at 0.1%.
Meanwhile the other capital cities spent the quarter in the negative territory.
Sydney house prices remained flat in the quarter for the fifth consecutive quarter, down -4.1% in the 12 months to March. But unit prices went up by 1% – the first increase since December 2007, but remain -1.2% below a year ago.
Brisbane house prices declined by 0.5% for the fourth consecutive quarter. The 12-month fall in price of -6.1% is second only to Perth amongst the national capitals. Unit prices fell by -2.1%, the most in the country.
Bell said most areas have experienced some weakness at the top end of the market. This segment has shown quarterly declines of 5% in some states.
But he added the good news is that there are signs of strength at the more affordable end. The market has seen increased activity by first home owners in the March quarter with minimal falls and even rises in median prices in the sub-$500k price range in some capital cities.
“The combination of the introduction of the First Home Owners Boost last October and the dramatic reduction in mortgage rates from their peak of nearly 10% in August to around 5% in March has improved affordability for many Australians looking to purchase their first property. Strong gross rental yields are also making the potential investment market more attractive to buyers.
“Home-buyers have been taking advantage of flat or falling prices in most capital cities over the past year. With interest rates likely to resume their downward path in the second half of 2009, buyers can look forward to the promise of historically low mortgage repayments for some time to come.
Perth remains the weakest housing market with prices falling -7.0%. House prices levelled out to fall only -0.6%. Unit prices rose for the first time since March 08, with the strongest quarterly growth outside Darwin of +2.0%.
In Adelaide, the -1.7% quarterly fall in house prices was the largest in the country, giving a 12-month fall of -2.2%. Unit prices also fell -1.7%, producing an annual price rise of +2.7%, the strongest unit market in the country outside Darwin.
Canberra house prices rose 0.8% but unit prices dropped -0.8%. In the 12-months, house prices have fallen by -5.7% and unit prices have fallen by -4.5%.
Finally Hobart house prices rose by +0.8% in the quarter, and remain unchanged in the 12-months to March. But unit prices have the worst 12-month performance of all the capitals, down -7.9%. Unit prices fell by -1.5% in the March quarter.
Quarterly Composition Adjusted Median Price Series | |||||
Houses | |||||
Mar-09 | Dec-08 | Mar-08 | QoQ % ∆ | YoY % ∆ | |
Sydney | $529,926 | $531,111 | $552,816 | -0.2% | -4.1% |
Melbourne | $444,595 | $437,537 | $446,527 | 1.6% | -0.4% |
Brisbane | $414,909 | $417,175 | $442,054 | -0.5% | -6.1% |
Adelaide | $404,921 | $411,968 | $413,935 | -1.7% | -2.2% |
Canberra | $477,334 | $473,390 | $506,442 | 0.8% | -5.7% |
Perth | $473,292 | $476,233 | $508,831 | -0.6% | -7.0% |
Hobart | $281,987 | $279,666 | $282,111 | 0.8% | 0.0% |
Darwin | $490,300 | $483,075 | $461,422 | 1.5% | 6.3% |
National | $469,908 | $469,461 | $487,974 | 0.1% | -3.7% |
Quarterly Composition Adjusted Median Price Series | |||||
Units | |||||
Mar-09 | Dec-08 | Mar-08 | QoQ % ∆ | YoY % ∆ | |
Sydney | $367,751 | $364,314 | $372,378 | 0.9% | -1.2% |
Melbourne | $334,302 | $332,561 | $338,317 | 0.5% | -1.2% |
Brisbane | $334,015 | $341,088 | $343,743 | -2.1% | -2.8% |
Adelaide | $265,161 | $269,709 | $258,294 | -1.7% | 2.7% |
Canberra | $346,084 | $348,699 | $362,288 | -0.8% | -4.5% |
Perth | $341,607 | $332,848 | $365,743 | 2.6% | -6.6% |
Hobart | $202,962 | $206,114 | $220,406 | -1.5% | -7.9% |
Darwin | $382,085 | $349,596 | $321,697 | 9.3% | 18.8% |
National | $340,591 | $338,908 | $347,679 | 0.5% | -2.0% |
Looking ahead, Bell said rising unemployment and a weakening economy pose the greatest risk to housing.
But he said capital city median prices are unlikely to experience large falls, being cushioned by low interest rates, record government fiscal stimulus and an undersupply of housing.
“Despite the likely end of the First Home Owners Boost in the May budget, the fundamentals of the market point to residential property prices stabilising in the second half of 2009 and early 2010,” he concluded.
Australian Property Journal