Cotality’s daily dwelling values index shows that values at the 5-city aggregate level declined by 0.9% in July, with losses recorded across all major capital cities except for Perth. Sydney (-1.4%) and Melbourne (-1.2%) once again led the declines.
Over the July quarter, dwelling values at the 5-city aggregate level declined by 2.0%, again led by Sydney (-3.7%) and Melbourne (-3.0%), with Brisbane (-0.1%) also posting losses:
While Perth posted a modest 0.1% rise in dwelling values over the calendar month, values have begun to decline over the past 28 days. The pace of decline at the 5-city aggregate level, and indeed in most other major capital cities, has also steepened:
Values have now declined from their latest respective daily peaks across all major capital city markets.
As illustrated below, cumulative value losses have now hit 5% in both Sydney and Melbourne, while smaller losses of less than 1.0% have been recorded in the other major capital cities.
At the 5-city aggregate level, the peak-to-trough value decline has now hit 2.3%.
Falling buyer demand helps to explain the correction in home values. The national capital city auction clearance rate has tracked below 50% for nine consecutive weeks, despite rebounding modestly in July.
At the same time, Cotality has reported a sharp rise in listings, especially across Brisbane, Perth and Adelaide:
Cotality: Listings increase from a year ago
Slowing demand amid rising supply typically means falling prices.
The only upside is that this week’s softer-than-expected trimmed mean inflation print from the Australian Bureau of Statistics means that further rate rises are off the agenda for now.
Therefore, homebuyer demand in the immediate term shouldn’t decline further.
The full Cotality monthly results for July will be released tomorrow.
