After a 17-month climb, house prices in Sydney showed signs of slowing as it fell 0.1 percent in September while growing by only 0.2 percent in the third quarter, reported The Guardian.
Melbourne and Hobart, on the other hand, continued to witness strong price growth at 0.9 percent and 1.7 percent in September and two percent and 3.4 percent during the quarter, respectively.
Nonetheless, combined capital growth across Australia stood at only 0.7 percent in Q3 2017, way lower compared to the 3.5 percent quarter-on-quarter peak registered in December 2016.
The figures indicated that the housing market was losing team as the tighter lending rules start to bite, said property analytics firm CoreLogic.
“This slowing in the combined capitals growth trend is heavily influenced by conditions across the Sydney market where capital gains have stalled,” explained CoreLogic analyst Tim Lawless.
The slowing market will be a welcome news to regulators. The Reserve Bank of Australia has cautioned of the rise in household debt, while the Australian Prudential Regulation Authority sought to rein in interest-only mortgage lending.
Meanwhile, the latest data also revealed an “increasing presence” of first-time home buyers in the market, said Lawless.
“Based on housing finance commitments data, first-home buyer activity surged higher in NSW and Victoria as first-timer buyers took advantage of stamp duty concessions that went live on July 1st.”
“Between June and July, the number of first home buyer commitments increased by 28 percent across New South Wales and 11 percent across Victoria,” he added.
However, he noted that first-time home buyer numbers trended higher “across other states where stamp duty rules were unchanged, suggesting that lower affordability barriers and an increasing appetite for owner-occupier lending is fuelling a broader rebound across the first-time buyer segment”.
This article was edited by Keshia Faculin.
