After years of growth Australia’s housing market is slowing but the total value of the country’s 10 million homes is closing in on $7 trillion.
Residential property prices rose 5 per cent through the year to December quarter 2017, with growth easing from the September (+8.3 per cent) and June (+10.2 per cent) quarters, according to figures released by the Australian Bureau of Statistics.
The total value of Australia's 10 million residential dwellings increased $92.9 billion to $6.9 trillion. The mean price of dwellings in Australia is now $686,700.
"The results are in line with market indicators like falling auction clearance rates, and point to a continued moderation in annual property price growth across a number of Australia's capital cities," ABS chief economist Bruce Hockman said.
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The through-the-year growth for Sydney (3.8 per cent) has slowed significantly, down from 9.4 per cent in the September quarter 2017.
"The property price result of 3.8 per cent in Sydney can be partly explained by tighter regulatory conditions and the resulting slowdown in investor credit growth," Hockman said.
In the December quarter, rises in the residential property price index for Melbourne (+2.6 per cent) and Hobart (+3.9 per cent) were partially offset by falls in Sydney (-0.1 per cent) and Darwin (-1.5 per cent).
Adelaide had a yearly gain of (+3.6 per cent), and Brisbane rose (+2.1 per cent).
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The figures reveal a shift in the pattern of house price growth across Australia’s capital cities.
“Home prices in Hobart are now the fastest growing of any capital city,” HIA senior economist Shane Garrett said.
“Sydney had consistently topped the list in recent years but has since slipped to fourth place in terms of price growth.”
“Tasmania’s capital had been stuck in the doldrums only a couple of years ago. Hobart’s impressive turnaround will give hope to other markets around Australia. The home building industry in cities like Adelaide, Perth and Darwin have been hurt by weak prices over recent years.”
A Reuters poll showed economists had expected home prices to be flat, on median for the quarter on a weighted-average basis across Australia's eight major cities. Estimates ranged between a fall of 1 per cent and a rise of 1.7 per cent.