Melbourne values suffer as national price correction now year long: CoreLogic

September marked the 12th month of the national dwelling value decline, according to CoreLogic's national hedonic home value index.

Values dropped 0.5 percent over the month, with values tracking lower across five of the eight capital cities.

Five of the seven 'rest of state' regions recorded a fall in values over the month.

Since the national index peaked 12 months ago, dwelling values have fallen by 2.7 percent.

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Melbourne's dwelling values dropped the most out of any capital city. They dropped 0.9 percent, which in turn has made the Victorian capital the worst performer over the quarter.

Sydney's decline continued with a 0.6 percent decline over September, the same as Perth. It is now 6.1 percent down over the year.

Tim Lawless, head of research at CoreLogic, called Sydney and Melbourne the 'primary drag.

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“While the housing market downturn is well entrenched across Darwin and Perth where dwelling values remain 22.1% and 13.2% lower relative to their 2014 peak, Sydney and Melbourne are now the primary drag on the national housing market performance," Lawless said.

“We’ve seen Sydney dwelling values drop 6.1% over the past twelve months and Melbourne values are 3.4% lower. Not only are these amongst the largest annual falls across the capital cities, but considering Sydney and Melbourne comprise approximately 60% of the national value of housing, the weak conditions in these cities have a substantial drag down effect on the overall national housing market performance.”

The current rate of decline is slower relative to the previous housing market downturn (Jun 2010 to Feb 2012) when national dwelling values fell by three percent over the first twelve months, declining 6.5 percent from peak to trough.