House values dropped for the ninth consecutive month in June, continuing their downward trajectory from the record highs of September 2017, according to CoreLogic.
Australian home values were down by 0.2% and 0.8% compared to last month and last year, respectively. CoreLogic research director Tim Lawless pointed out that house values across the country are still 32.4% higher than they were five years ago, even with these recent monthly decreases.
“This highlights the wealth creation that many home owners have experienced over the recent growth phase, but also the fact that recent home buyers could be facing negative equity."
Lawless said that tighter finance conditions and lower investment activity have been the main drivers of weaker market conditions. "We don’t see either of these factors relaxing over the second half of 2018, despite APRA’s 10 per cent investment speed limit being lifted this month," he added.
CoreLogic’s recent hedonic home value index report also saw continuous home value growth in Hobart. Although the quarterly pace has slowed relative to the March quarter when values were up 3.4%, housing market trends remained positive, with a 2.3% increase over the past three months.
Melbourne was the weakest performing capital city in June, as it saw values drop 1.4%; Darwin was the city with the highest rental yield, up 5.7%; and Melbourne accumulated the lowest rental yield, down 3%.
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