House prices hit a 7-year low

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The Real Estate Institute of Australia (REIA) reported the largest house-price decline since December 2011, implying losses for property sellers and wins for buyers.

The REIA Real Estate Market Facts report for the September quarter showed that weighted house average median prices dropped by 1.6%, marking the steepest decline in almost seven years. Other dwellings also recorded a 0.8% decrease, the category’s largest decline in a year.

The weighted average median price for houses in eight capital cities dipped to $751,411 over the quarter, with prices decreasing in almost all the capital cities. Brisbane and Adelaide bucked the downward trend, while Melbourne values remained stable.

The research found that Hobart had the largest fall in house prices and has the lowest median price for houses at $475,000.

The weighted average median price for other dwellings, meanwhile, decreased to $587,959 over the same period, with prices dropping in all capital cities except for Melbourne and Canberra.

Darwin had the largest price drop in other dwellings, while Adelaide had the lowest median price for other dwellings at $344,000.

REIA President Malcolm Gunning said that the median rent for three-bedroom houses increased in Melbourne and Hobart, and remained steady in Sydney, Brisbane, Adelaide, Perth and Canberra. Darwin, meanwhile, was the only capital to see falls in median rent for three-bedroom houses.

On the other hand, the median rent for two-bedroom other dwellings rose in Melbourne, Brisbane and Adelaide, remained steady in Sydney, Perth and Canberra, and decreased in Hobart and Darwin. Melbourne recorded the largest increase, while Hobart had the biggest cut.

The report also found that the rental market showed signs of cooling as the weighted average vacancy rate for the eight capital cities increased to 2.6% during the quarter.

The vacancy rates of Sydney, Melbourne, Brisbane, Canberra and Hobart reached below the 3% benchmark, which reflected a strong demand for rental accommodation in these capital cities.

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