Australian house prices have fallen in every capital city this quarter, with the exception of Melbourne and Hobart, according to the March Quarter Domain House Price Report.
The report also found that unit prices have fallen across the board, in the wake of a record number of apartments being built in state capitals in recent years.
In Sydney, median house prices dropped below $1 million to $995,804, a 1.5% drop over the March quarter. Unit prices also fell for the second successive quarter, down to $656,156, a drop of 0.7%.
Brisbane, Perth, Canberra and Darwin all also recorded notable drops in house and unit prices. Adelaide house prices also fell, yet the South Australian city was the only capital where unit prices remained steady.
The story is slightly different in Melbourne, which recorded an increase of 1.2% in house prices over the March quarter, with a median price of $726,962. Unit prices in Melbourne fell to a median of $444,370, a decrease of 1.7%.
Dr. Andrew Wilson, Domain Chief Economist, said, “Melbourne has now overtaken Sydney as the fastest growing capital city housing market in Australia. Melbourne has recorded 14 consecutive quarters of house price growth, the longest sequence since June 2008.”
Interpreting the overall national results, Wilson said, “Weakening economic activity and growing uncertainty is impacting fragile consumer and investment sentiment, leading to falling house and unit prices in most capital cities.
“The outlook for house prices remains subdued with capital city growth likely to continue to track at best just above the inflation rate for the remainder of 2016. The prospect of weaker house price growth, however, will be welcomed by prospective first home buyers still struggling to get into the market.”
“The national median has now fallen over two consecutive quarters for the first time since June 2011 as the general housing market correction consolidates.”