The first monthly price drop in nearly a year


In trying times and with overall buyer demand weakening marginally, Sydney has seen its first fall in house prices since July 2019, according to CoreLogic. Data up until May 18th shows home values of Sydney declined 0.04%, whilst the values of our capital cities combined dropped by 0.20%.

With transactions and activity impacted due to low consumer confidence, declining figures may not come as a surprise, although looking at the broader picture, values are still up by 10.1% over the past year. Whilst values may be trending lower, low stock levels combined with the flexibility from lenders ensure the declines are moderate. Just recently, the Australian Banking Association released that there have been 703,419 loan deferrals, 429,676 mortgage deferrals and a total of $211 billion worth of loans deferred up until the 16th of May.

As for auction results, the temporary ban of open homes and on-site auctions saw an increase in properties being withdrawn from auction, and an increase in private treaty sale methods. As a result, the clearance rates for our capital cities combined dropped to a record low of 30.2% in the week ending April 19th. Auction clearance rates and changes in home values typically correlate, although the fierce decline in clearance rates we have seen is largely a result of statistic analyzers counting ‘withdrawn’ properties as a non-sale, meaning housing values may not necessarily follow a similar downward trend. With the return of open homes and on-site auctions there is a question of a stabilization in pricing, however, being able to physically inspect or publicly bid on property is one thing; one’s capacity to actually transact on property is another.

With social distancing measures relaxing and overall morale increasing, there is still a potential downside risk as high rates of unemployment remain, as well as the potential of higher mortgage arrears once the repayment hiatus is over. The real estate market will more likely trend positively when other sectors show signs of recovery.

If you have plans with property contact us on 02 4504 8004 to see how we can best assist you.⁠⠀⁠

We look forward to seeing you out and about!