Values dropped across the nation in December, which was bad news for sellers, but good news for those looking to get into the market.
The long-running house price boom locking many potential buyers out of the market looks like it's finally over. CoreLogic's December Home Value Index reveal that values across the nation fell 0.3 per cent.
This December fall means that national dwelling values rose across the country just 4.2 per cent over 2017. This was significantly below the 5.8 per cent value rise in 2016, and the strong 9.2 per cent gain in the bumper year of 2015.
The median house price across Australia now sits at $549,000. The runaway train of the Sydney property market was slowed as houding values dropped 2.1 per cent over the quarter. It saw out 2017 by climbing just 3.1 per cent, ending the year with a median house price of $895,000.
CoreLogic head of research Tim Lawless says values in Sydney are expected to fall over an 18 to 24 month period by around 5 to 10 per cent. Stricter credit policies have hit Sydney where it hurts – in the investment market.
At one stage Sydney had more than 60 per cent investor activity in comparison to Melbourne which has less than 50 per cent. As a result, the Melbourne market has remained strong, also in part due to greater affordability.
Only three capital cities recorded property rises for December. Hobart was the star performer, escalating 1.5 per cent whilst Canberra and Adelaide both rose 0.2 per cent. Things are also looking up in the west with the previously struggling Perth market now appearing to be at the bottom of their decline. They recorded a decline of -0.1 per cent for December. Brisbane remained steady on 0.0 per cent and Darwin was the worst performer recording a negative of -0.9 per cent.
Despite the tighter lending policies around unit investments, Sydney unit values were still strong recording value hikes of 5.4 per cent with a median of $774,000, compared to Sydney houses which gained just 2.1 per cent annually with a median of $1.06 million.
It is understandable that people are nervous about investing in property at the moment considering growth in wages has not kept pace with rising dwelling prices and cost-of-living.
Despite this, an investment property remains a favourable investment choice. For many it has delivered solid returns over a sustained period of time.
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