Latest NewsIndustry Market WrapTuesday, 09 August 2016

The latest figures tracking the performance of the US housing market came out this week, with the First American Core Logic House Price Index (HPI) release revealing US housing prices fell 11.5 percent as of March ‘09 compared to a year ago, a slight improvement from an 11.7 percent annual decline as of February. Two trends are becoming evident in the US market: price declines are slowing in the states that have had the highest declines over the past three years; however, declines are accelerating in states that have been experiencing only moderate decreases during that same period. Thirty-three states (out of fifty) have exhibited acceleration in the rate of price declines in the last three months. Since U.S. home prices peaked in July 2006, national home prices have declined 22.3 percent on a cumulative basis and are currently down to the lowest price level in more than five years.

Australian market values, in comparison, have been exceptionally resilient. The April figures for the RP Data-Rismark House Value Index will be released this week. Based on last month’s figures (to March ’09) Australian property values increased by 1.6 percent over the first three months of the year. Overall, Australian dwelling values are just 2.5 percent or $11,800 lower than the February 2008 peak.

Clearance rates in Australia’s auction markets have improved substantially since the start of 2009. In Melbourne, Australia’s largest auction market, clearance rates were averaging 60% during 2008. Over the past month clearance rates have been around the 80% mark. In Sydney, auction clearance rates have moved from a ‘08 average of 40% to consistently achieve 60% or greater since the first week of February.

The total number of weekly listings has remained below the 12 month average suggesting new stock additions are very controlled and total stock on market has remained consistent suggesting a healthy rate of absorption.

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