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Steven Cross
Australia’s home values have suffered the biggest fall in six years, defying the Reserve Bank’s efforts to spark a recovery in the property market.
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According to the latest statistics from RP Data, Australian house prices have fallen 5.3 per cent since the beginning of the year.
But despite the drop in prices, RP Data chief executive Graham Mirabito said the news isn’t all bad.
According to Mr Mirabito, the latest drop in house prices suggests the property market has now officially “bottomed out”.
“We did see Australia slip overall 5.3 per cent from the beginning of the year. What we’re seeing is the overhang of too much stock on market from the end of last year,” he told The Adviser.
“What we had was around 23 per cent more stock on market from the year before. The total stock on market now is around 9 per cent higher than this time last year, so it is good that stock is starting to deplete.
“And price discounting has dropped from 7.9 to 7.1 per cent – all of which indicate that the market is starting to bottom out.”
Mr Mirabito said moving forward there will be considerably more strength from affordable and middle tier housing.
“Inflation is relatively under check at around three per cent. People are being paid more. So affordability is up, and the affordable market and the mid-market will continue to be reasonably solid, while the top end will struggle. “
