Sydney property prices rose for the first time in almost two years in June, adding to signs Australia’s housing slump is nearing an end.
- House values in the nation’s biggest city gained 0.1% last month, CoreLogic Inc. data released Monday showed. However, prices across the combined state and territory capitals fell 0.1%, the data showed.
- A triple dose of positive news is flowing through to the property market: the central bank cut interest rates last month, the banking regulator has proposed easing mortgage-serviceability rules, and the opposition Labor Party’s surprise election loss killed off plans to wind back tax breaks for property investors.
- In other signs sentiment is improving, auction clearance rates are holding above 60% in Sydney and Melbourne, realtors are reporting bigger crowds inspecting properties and lenders are getting more inquiries from borrowers, CoreLogic’s head of research Tim Lawless said.
- However, a rapid recovery isn’t on the cards. The economy is struggling outside the commercial hubs of Sydney and Melbourne (where home prices rose 0.2% last month), lenders are still taking a tough stance on approving loans, and there’s a glut of apartments hitting the market.
- Sydney housing prices have fallen 14.9% from their July 2017 peak
- Smaller cities are still suffering — house prices in Canberra and Darwin both slumped 0.9% last month, while Perth values dropped 0.7%