Melbourne real estate values continue decline through July: CoreLogic
July saw a third consecutive month of declines for property values across the country, with the national index dropping a further 0.6 per cent over the month, according to property data firm CoreLogic.
The decline however was slightly less than the -0.7 per cent declines posted over June.
Canberra (+0.6 per cent) and Adelaide (+0.1 per cent), were the only capitals to buck the trend.
Sydney and Melbourne led the way in declines, with the Victorian capital, now in lockdown again, seeing a -1.2 per cent decline, and the harbour capital with values scaling back -0.9 per cent.
Melbourne's quicker decline has seen its annual returns drop below 10 per cent for the first time since March.
CoreLogic's head of research Tim Lawless says housing markets have remained relatively resilient through the COVID period so far.
“The impact from COVID-19 on housing values has been orderly to-date, with CoreLogic’s national index falling only 1.6% since the recent high in April and housing turnover has recovered quickly after it’s sharp fall in late March and April.”
“Record low interest rates, government support and loan repayment holidays for distressed borrowers have helped to insulate the housing market from a more significant downturn.
"Advertised supply levels have remained tight, with the total number of properties for sale falling a further 4.3% in the 4 weeks to July 27th, sitting 15.2% below where they were this time last year.
"Additionally, increased demand driven by housing specific incentives from both federal and state governments, especially for first home buyers, have become more substantial.”
Houses and Units
It was another mixed bag for the housing and unit market across July, with the unit market holding up slightly better than the housing market across most capitals.
Sydney, Melbourne and Hobart all saw units outperform houses, while Brisbane, Adelaide, Perth, Darwin and Canberra all saw a stronger month for housing.
It was again the housing market that dragged Melbourne and Sydney to the top of the worst performers.
Melbourne's housing market saw a further -1.4 per cent declines, following on from -1.3 per cent declines in June, while Sydney's one per cent contraction across July was slightly worse than its -0.9 per cent last month.
Both of the country's major capital city markets saw their units scale back -0.7 per cent.
Tim Lawless says the medium term outlook remains skewed to the downside across the country with the government's fiscal support set to taper from October.
“Urgent sales are likely to become more common as we approach these milestones, which will test the market’s resilience", Lawless suggests.
"Similarly, the recent concerns of a second wave of the virus and the potential for renewed border closures and stricter social distancing polices are likely to further push consumer sentiment down.
"This is likely to weigh on both home buying and selling activity more broadly.”