Below trend growth to continue
CoreLogic's national Home Value Index moved through a seventh month of decline last month with values dropping -1.0%, bringing values approximately -$53,400 below April's peak.
The decline comes after national housing values surged almost 29% through the recent upswing, adding roughly $171,000 to the value of the average dwelling.
In good news for home owners, although values are continuing to trend lower, the rate of decline has been consistently moderating since the national index dropped by -1.6% in August.
The easing in the rate of decline is mostly emanating from Sydney and Melbourne, but is also evident across many of the smaller capitals and most regional markets. Three months ago, Sydney housing values were falling at the monthly rate of -2.3%. That has now reduced by a full percentage point to a decline of -1.3% in November. In July, Melbourne home values were down -1.5% over the month, with the monthly decline almost halving last month to -0.8%.
The rate of decline has also eased across the ACT, and is no longer accelerating in Brisbane. Most of the broad rest-of-state markets have also seen the pace of declines decelerate.
Potentially we are seeing the initial uncertainty around buying in a higher interest rate environment wearing off, while persistently low advertised stock levels have also contributed to this trend towards smaller value falls. However, it’s fair to say housing risk remains skewed to the downside while interest rates are still rising and household balance sheets become more thinly stretched.
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