By Prashant Mehra
(Australian Associated Press)
Official figures have confirmed a cooling in the property market, with residential price rise moderating in the September quarter.
The increase in capital city home prices averaged just two per cent in the three months to September, down from the 4.7 per cent rise in the previous quarter.
Sydney and Melbourne were the only cities to post home price rises of more than two per cent in the September quarter, data from the Australian Bureau of Statistics showed.
Sydney home prices rose 3.1 per cent during the quarter, but this was significantly lower than the 8.9 per cent increase clocked in the June quarter.
It was followed by Melbourne with 2.9 per cent in prices, compared to 4.2 per cent in the previous three months.
“Tighter lending policies are driving investors out of the market. Falling interest from foreign buyers and growing affordability problems are also contributing to the cooling down,” CMC Markets chief market analyst Ric Spooner said.
Over the year to September, the residential property price index was up 10.7 per cent, the Australian Bureau of Statistics said on Tuesday.
At 19.9 per cent, Sydney’s annual price growth was more than twice as fast as the next best city, Melbourne. The harbour city has enjoyed double-digit growth since the September quarter of 2013.
However, the property market in the rest of the country has continued to flounder.
Perth and Darwin had the weakest outcomes, being the only cities to post a fall in prices in the September quarter and in the year.
“Moderation is taking place, but the September quarter data is not showing the full picture. The December quarter data will show the slowdown more clearly,” CommSec economist Savanth Sebastian said.
Australia’s Big Four banks struck out-of-cycle mortgage rate hikes in November, and the full impact from these would be fully reflected in upcoming home price data, Mr Sebastian said.
CAPITAL CITY HOME PRICES
* Sydney – up 3.1pct in Sept qtr, up 19.9pct in the year
* Melbourne – up 2.9pct and 9.9pct
* Brisbane – up 1.3pct and 3.8pct
* Canberra – up 1.3pct and 4.0pct
* Adelaide – up 1.2pct and 3.5pct
* Hobart – up 0.5pct and 1.7pct
* Darwin – down 0.4pct and down 2.0pct
* Perth – down 2.4pct and down 3.3pct
(Source: Australian Bureau of Statistics)