Corelogic`s focus in April is to review the performance of the housing market over the first quarter of the year and examine the factors which are influencing market conditions.
Australian dwelling values held firm in March, with the combined capitals continuing a softening trend, recording a 0.2% fall, while regional markets saw a 0.4% rise in values over the month.
Over the first quater of the year, capital city values were down by almost one percent compared with a 1.1% loft in regional dwelling values.
The combined regional markets have been outperforming the capital cities since October last year, with the strongest annual growth rates being recorded in the regions adjacent to Melbourne, Sydney and Canberra.
Victoria’s Geelong recorded the highest capital gains, with dwelling values up 10% over the past twelve months followed by the Southern Highlands and Shoalhaven in New South Wales with a rise of 9.5%.
The Capital region of New South Wales, which includes Queanbeyan, recorded a rise of 8.3%, as did the Newcastle and Lake Macquarie region.
It seems that buyer demand has rippled away from the capitals where growth in home values has been strongest, towards areas where housing is more affordable, but also jobs, amenity and transport options are also reasonably plentiful.
Across the capital cities, Sydney has continued to show the largest month on month declines, with dwelling values down 0.3% in March to be 3.9% lower since peaking in July last year.
Melbourne, down 0.2% and Adelaide, down 0.3%, were the only other capitals to see dwelling values fall over the month.
At the other end of the spectrum is Hobart where dwelling values were 1.7% higher over the month.
Darwin recorded its first month on month rise in almost a year, up 1%, while subtle rises were also recorded across the Brisbane, Perth and Canberra markets.
Across the combined capital city valuation segments, it`s clear that value falls have been more substanial across the premium end of the housing market.
Analysing CoreLogic inices data across deciles shows the only valuation based segment of the market to record an annual fall over the past twelve months has been the most expensive 10% of properties where values are down 3.8%.
Further to this, over the March quarter, value declines were recorded across the most expensive half of the market while the most affordable end of the market continued to record a subtle rise in values.
Another noticeable trend is that unit values are now outperforming house values; a trend that was reversed during the growth phase.
The stronger performance is subtle at the combined capitals level, with capital city house values down 1% the March quater while unit values were down a more moderate 0.7%.
More significant differences between houses and units can be seen in Sydney and Melbourne where housing affordability pressures are more evident relative to other cities.
Sydney unit values are up 1.9% over the past twelve moths, while house values are down 3.8%.
Similarly in Melbourne, unit values are 6.6% higher over the past twelve moth while house values are up just 4.9%.
The stronger perforance from the unit sector may suggest that buyer demand is becoming more concentrated in the medium to high density sector where entry prices are lower and commuting times are often more convenient when compared with the similarly priced detached housing markets around the outer fringes of the city.
Outside of the Sydney and Melbourne, where affordability constraints aren`t as pressing, it is the detached housing sector that is showing stronger conditions.
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