Australian property downturn spreads as most capital cities record falling values

The March drop in average Australian home prices was the smallest of the month-on-month declines since October.

Hobart was the only capital city which saw average dwelling prices rise in the last three months (up 1.2 per cent) - and are at record-highs of $464,168.

Lawless said that the housing market has recently shown some tentative signs that the downturn in dwelling values is losing some steam.

The quarterly trend in dwelling values is showing a similar pattern, with six of the eight capitals recording a fall in values over the March quarter, led by Darwin (-3.9%), Melbourne (-3.4%) and Sydney (-3.2%). House values, however, have fallen even further, down by 0.7 per cent last month to be 11.8 per cent off since March 2018.

Melbourne's inner-east has the dubious distinction of being Australia's worst performing housing market, with values plunging by 16.1 per cent during the past year.

The downturn, however, is now more widespread with every other state capital slipping during the March quarter, with dwelling values falling by 1.1 per cent in Brisbane, 0.5 per cent in Adelaide, 2.9 per cent in Perth and 3.9 per cent in Darwin.

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'While the pace of falls has slowed in March, the scope of the downturn has become more geographically widespread, ' the group's head of research Tim Lawless said. But falls were extending to other parts of the country.

Australian home prices have now fallen 7.4% since peaking in late 2017, according to CoreLogic's Home Value Index.

The worst-hit regional market continues to be non-metropolitan Western Australia, where dwelling values are down by 9.5 per cent over the past year and 25.8 per cent over the past five years.

Melbourne's equivalent values has plummeted by 13.8 per cent or $114,005, to $718,443, since reaching a summit in November 2017, with median house values diving by an annual pace of 12.4 per cent.

Melbourne's housing market is now down 12.4 percent annually, now ahead of Sydney's 11.8% annual decline.

Of the 46 capital city sub-regions monitored by the real estate analysis company only seven areas were able to avoid annual falls - a dramatic shift from the 30 areas holding up in positive territory at the same time a year ago. Hobart prices are record high for both houses and units, forcing out many first home buyers. Capital city rents dropped by 0.1 per cent through the year to March, the first negative result since May 2015.

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