Property prices have been rising since March 2013 but the May figures in the RP Data-Rismark Home Value Index show an average drop of 1.9 per cent in capital cities across Australia.
Dwellings in Melbourne recorded the greatest drop in prices with a 3.6 per cent fall, while Sydney prices softened 1.1 per cent, and Brisbane was down 1.7 per cent. One capital city, Canberra, went against the trend and rose 0.1 per cent.
There are several factors which may have contributed to the fall. RP Data’s research director, Tim Lawless, says it is routine to see a cooling in the Australian property market in April and May after the traditionally busy autumn selling season.
When looking at the last 12 months it is important to keep in mind that current prices remain well above those from last year. Capital city values have increased by an average of 10.7 per cent on a year-on-year basis, with Sydney properties up by 16.6 per cent.
Sydney remains Australia’s most expensive city with a median house price of $678,500, while the most affordable is Hobart with a median property price of $345,000.
There are still signs of heat within the market. In Sydney recently, the new Aqua development in Bondi Junction sold all 129 apartments on the first day of sales, while another development in Lindfield sold 75 per cent of apartments on offer.
With rates remaining at a record low and property market confidence at a high, it is likely that this is a small dip in the market that could well be the calm before the buying storm.
Jeremy Fisher, director and founder, 1st Street Home Loans
Jeremy Fisher is one of the most awarded mortgage brokers in the industry and winner of the Australian Broker Association’s prestigious ‘Australian Broker of the Year’. Since 2001, Jeremy has settled in excess of $750 million worth of property loans and delighted clients with exceptional results and highly personalised service.