Sydney house prices fell in September for the first time in 17 months, in further evidence that the wind has gone out of the sails of the New South Wales capital’s property market.
In the first month of spring, property prices fell by 0.1 per cent in Australia’s most populous city, Core Logic revealed on Monday.
The last time capital gains on property dropped in Sydney was in February 2016.
The pronounced cooling was further reflected in Saturday’s auction clearance rate, which fell to 65.3 per cent in Sydney, according to Domain.
That was down from 70.2 per cent the week before, and 76.6 per cent on the equivalent Saturday in 2016.
By comparison the Melbourne property market continues to boom, with monthly capital gains of 0.9 per cent, and a clearance rate on Saturday of 79 per cent.
In real terms, however, Melbourne property prices are still far below Sydney’s.
The average Sydney property is now worth $909,613, while the average Melbourne property is worth $703,816.
CoreLogic head of research Tim Lawless noted that, though still resilient, capital growth in the Melbourne property market was also slowing.
Sydney and Melbourne are by far the most expensive cities in Australia in which to buy a house.
Canberra was the only other city to break the half a million mark.
The average house in Australia’s capital will set you back $580,043.
Judged purely on capital gains growth, Hobart was Australia’s standout performer, with growth up 1.7 per cent over the month of September, 3.4 per cent over the quarter, and 14.3 per cent over the year.
But in real terms, Hobart remains the cheapest capital city in which to buy a property, with the average house going for $391,618.
Apart from Sydney, the only capital city to see values decline was Darwin, where they fell by 0.7 per cent, and 4.7 per cent for the year.
The average house in Darwin is now worth $445,516.
Across Australia, capital gains growth on residential property stood at 0.2 per cent in September.
The average Aussie home now costs $540,647.
If you live in the country you can expect to pay on average $350,471 for a house – just over half the average price of a capital city, which stands at $648,845.
Commenting on the slower growth in Sydney, Mr Lawless said: “Potentially the affordability challenges facing Sydney buyers within the detached housing sector are pushing more demand towards the medium to high density sector, where, based on median values, houses are almost $290,000 more expensive than units.”
On Melbourne’s market, he said: “The stronger housing market conditions in Melbourne are supported by auction clearance rates which have consistently remained above 70 per cent.
Additionally, advertised stock levels remain remarkably low and private treaty sales continue to sell rapidly, averaging 30 days on market.”