SYDNEY and Melbourne dwelling prices copped the brunt of the pandemic’s impact, while Canberra was the only capital city to escape a fall in values during the June quarter.
Australian Bureau of Statistics data showed a 1.8% national drop in dwelling prices during the first quarter to be wholly impacted by COVID-19. Some $98.2 billion was wiped off the total value of Australia’s residential market, which is now at $7,138.2 billion.
Falls during the period were led by Sydney, down 2.2%, and Melbourne, by 2.3%. House prices fell 2.6% in Sydney and 2.8% in Melbourne, and attached dwellings by 1.4% in Sydney and 1.0% respectively.
Canberra dwelling prices lifted by 0.8%.
All other capitals saw declines. Darwin was down 1.4%, while Brisbane, Adelaide, Perth and Hobart dropped between 0.9% and 0.4%.
Melbourne still led house price gains over the 2020 financial year, up 8.8%, with Sydney not far behind at 8.1%. Hobart was next (6.1%), followed by Canberra (3.6%), Brisbane (2.3%) and Adelaide (0.7%). Darwin and Perth saw respective declines of 2.7% and 0.2%.
“The number of residential property transactions fell substantially in the eight capital cities during the June quarter 2020, due to the effects of COVID-19 on the property market”, head of prices statistics at the ABS, Andrew Tomadini said.
Sales in August were 10% below the 2019 average. The most recent CoreLogic data showed Melbourne house prices have now fallen 4.6% throughout the pandemic, and again posted the largest fall of the capital cities in the month of August as a second wave of the coronavirus forced renewed lockdown measures.
The Commonwealth Bank has just upgraded its house price forecast to a fall of just 6% nationally, which includes as 12% drop in Melbourne.
AMP Capital’s chief economist, Shane Oliver has retained a forecast of Melbourne prices tumbling 15 to 20% top to bottom. Sydney prices are expected to drop 10 to 15% decline, whereas Adelaide, Brisbane, Perth and Hobart are only likely to see falls around 5% or less. Canberra is likely to be steady or to the positive.
Capital Economics expects a forecast that house prices across the eight capital cities will eventually fall by 8% from their peak.