House prices have fallen nationally by just 2 per cent over the last March-to-June quarter according to the latest Domain House Price Report.
Yet some of the headlines in the media say “Property prices plummeting”
Far from it!
At a time when unemployment is rising and household incomes are shrinking, our housing markets have remained remarkably resilient.
“The outlook for the housing market is definitely more stable than the broader economy,” said Domain senior research analyst Nicola Powell.
“While prices in most capital cities have declined, the falls have been minimal to date.
“The unprecedented government stimulus with HomeBuilder, JobKeeper and JobSeeker, mortgage holidays, low stock levels and record low interest rates are shielding values from any significant declines, and helping to retain stability in the housing market,” Dr Powell said.
Clearly there are challenging times ahead for our property markets, but as buyers compete for the properties for sale in our better neighbourhoods, the predictions that were made by the property pessimist a few months ago of price falls of 10%, 20% or even 30% now seem even more unrealistic than ever.
Melbourne house prices fell more than any other capital city during the COVID-19-related downturn, and with a second lockdown now in place, it’s likely there are more price falls on the way.
But remember the Melbourne property market is very fragmented, with A grade homes and investment grade properties holding their value as well.
Apartments were not hit as hard in Melbourne, with a fall of just 1.7 per cent for the same period, and both house and unit median prices were still higher than a year ago.
The property recovery experienced by Sydney late last year and into the early months of this year was stopped in its tracks by the coronavirus pandemic , with the Sydney’s median house price dropping by 2% over the three months to June.
Domain senior research analyst Nicola Powell said:
“The market has changed quite quickly, but price falls to date have been minimal; significant government stimulus, mortgage holidays and low interest rates have helped to support home values.”
Sydney’s unit median price fell by 1.9 per cent to $735,417 over the quarter, the first unit price drop in a year.
House prices in the Brisbane have dropped 2.1 per cent over the three months to June according to Domain’s latest House Price Report.
Of course, like I’ve been to capital cities there is not one Brisbane property market and some areas have faired much better than others
“Prior to COVID-19, there was promising growth in prices for Greater Brisbane,” said Domain senior research analyst Nicola Powell. “Although this has reversed in the June quarter, the fall in prices to date has been minimal considering the economic aftermath of border closures and shutdowns.”