Anybody with the vaguest interest in the property market knows that prices have dropped pretty much everywhere in Australia except Tasmania, and particularly so in the major capitals of Sydney and Melbourne.
Property analytics company CoreLogic released data that shows the extent of the drop from the market peak in 2017 to the end of March 2019. Nationally the market has fallen by 7.4 per cent, which translates to around $40,590 in median housing values.
Sydney values are 13.9 per cent lower than at the peak, or down $134,739, whilst Melbourne values are down 10.3 per cent or $71,404.
Coupled with interest rates remaining the lowest they have been since the 1960s, and potentially falling even lower later this year, it’s a market that is favouring those who were previously priced out.
First-home buyers, who make up a large proportion of the house-and-land package market, are also seeing more affordable offerings in this sector, particularly in Melbourne.
The price of new dwellings dropped 1.2 per cent in the March quarter and incentives are also being offered to stimulate interest. According to the Financial Review, developers are offering discounts and incentives worth up to $45,000 with buyers even invited to negotiate.
Sydney’s land supply problem is given as one of the reasons why values have remained steady there, and in some cases increased, in contrast to the general housing market. Meanwhile, house and land packages start at less than $400,000 in Melbourne’s greenfield areas.
Experts are saying we may be nearing the end of the downturn. CoreLogic’s head of research, Tim Lawless, says that a variety of indicators, such as mortgage activity and auction clearance rates, along with a slowing rate of price declines in the biggest capitals, show “housing market conditions may have moved through the worst of the downturn”.
This could potentially mean first-time buyers need to act sooner rather than later to take advantage of the current market conditions.
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