Housing prices cooling off

On Friday RP Data-Rismark released its June month figures showing that housing
prices are cooling off.

The RP Data-Rismark hedonic home values
index for June reveals a decline of 0.7% in seasonally adjusted terms, the
first fall since October 2008

. The 0.7% decline follows average monthly rises of 1.0% in
the second half of last year, accelerating to 1.2% per month in the March
 quarter, but then stepping down to barely positive average monthly growth
of 0.1% in the June quarter.

The median house price growth over the last 12 months has eased back to 10.5% , down from 12.3% in the year to May and a recent peak of 13.6% to March this year .

The figures showed that the middle tier of prices of our capital city suburbs held up the best, while the most expensive (20%) of capital city suburbs have seen price declines in
prices now for the past three months. Similarly the bottom 20% of suburbs by price also saw prices fall over the last 2 months whereas the mid tier has also seen an overall cooling but prices just turning negative in June


According to RP Data all capital city cities recorded price declines in June.

The largest in June was in Perth (down 1.5%; but up 5.1% for the year), thenMelbourne (down 1.4%/+16.0% for the year), Canberra (-1.4%/+10.6% for the year), Darwin (-1.0%/+16.8% in the last 12 months), Brisbane (-0.8%/+4.5% for the year), Adelaide (-0.7%/+9.1%), while Sydney prices dipped 0.1%, up 10.4% for the year.

In May, Hobart prices fell 3.1%, but to be up 3.9% over the last 12 months.

This result  is not surprising, all the leading indicators pointed to a slowing market and gives the RBA the ability to keep interest rates on hold.


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