CoreLogic tip 2018 national dwelling values to end five percent down

National dwelling prices will have declined by five percent by the end of the year, CoreLogic have estimated in their 2019 market outlook.

They still say national dwelling values will be 22 percent higher relative to this time five years ago.

Through to the end of November, Sydney was the hardest hit, with dwelling values dropping 8.1 percent, while Hobart performed the best, seeing a 9.3 percent rise.

CoreLogic's head of research Tim Lawless said there is likely to be only three capital cities bringing down the national dwelling total.

“In all likelihood, five of Australia’s capital cities will finish the year with a positive annual movement in dwelling values, highlighting that weaker conditions in Sydney and Melbourne, and to a lesser extent, Perth, are the main drag on the national index," Lawless said.

"To assess the housing market trends over the coming year, it’s important to reflect on the factors that have driven the market performance more recently and how they are likely to change over the coming twelve months.”

He suggests the lack of credit availability is a key factor in the current housing market downturn, and expects lenders to remain conservative in 2019.

"With the final report from the Royal Commission due in early 2019, we expect lenders will remain conservative in their approach," Lawless advised.

"This implies that high quality borrowers will be in the driver’s seat (i.e those with large deposits, low debt relative to their income and a strong serviceability position).

"Borrowers with less than a 20% deposit and those with debt levels that exceed six times their income will find it harder to obtain finance and will likely face a premium on their mortgage rates.