Australian property values continue their downward trajectory. While the pace of the decline has slowed over February to March for most of capitals except Sydney and Perth, the decline is still a broad narrative affecting all 4 largest capitals.
Unfortunately, Perth property market doesn’t seem to catch a breath. We are seeing broad declines in Perth housing market with exception of some pockets in premium locations. Vacancies are trending lower but they are still too high for our liking.
Sydney housing market continues its downward trend. We are cautious on units at this stage, even though they are not as affected as houses to this date. We think that settlements for off the plan units artificially inflate the price and provide inaccurate picture of the market in our prime city. Sydney declined almost 1.8% from February 2019.
Melbourne is another downward story. We are seeing an accelerating decline in Melbourne prices. We indicated before that Melbourne is likely to follow Sydney and we expected the price declines to accelerate, which we are seeing now.
The surprise is Brisbane. We expected Brisbane prices to remain flat, instead we have seen a significant drop over a very short period. We are hoping this is just a result of The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry. If that is the case, the prices should balance out soon.
Overall, Australian property market is seeing a broad decline, affecting most of capitals with exception of Hobart. Even Adelaide is not looking too exciting at the moment. Therefore we are not expecting any changes in the market trajectory yet. We think our forecasts have been fairly on the spot so far. And we are not seeing any major reasons to change them.
With the federal election looming and possible changes resulting from the outcome of the elections, we are keeping a keen eye on the Australian property market.