Sydney home prices grow again for second consecutive month

They had been falling for nearly two years but Sydney home prices appear to be on the rebound, growing for the second month in a row. And it’s due to some recent market changes.

Sydney home values have grown again for the second month in a row after falling for nearly two years.

The median price of all dwellings, including units, townhouses and houses, increased 0.2 per cent over July, CoreLogic’s latest home value index showed.

This was an improvement on the 0.1 per cent rise in prices over June and the strongest month of activity since July 2017 when the market was its peak.

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CoreLogic head of research Tim Lawless said the market turnaround was the result of lower mortgage rates and improved access to credit.

Apartment values have been growing faster than house values.

There was also a boost in buyer confidence after the surprise federal election result and recent tax cuts were pulling new buyers into the market, he said.

“It’s creating a stronger selling position for vendors,” Mr Lawless said, adding that sellers were getting a further boost from low listings volumes, which meant multiple buyers often vied for the same properties.

Despite the return to growth, Sydney prices remain well below what they were two years ago. The median price of a Sydney home is now $776,000, 14.7 per cent lower than it was in 2017.

Prices in regions where there was a high level of new housing construction were even further below their peaks. Ryde home values were down 23 per cent from two years ago, while Canterbury-Bankstown values were 18 per cent off their peak.

A typical Sydney home now costs about $776,000.

Prices in the Hills, Sutherland Shire, Parramatta and inner west were about 15 per cent lower than two years ago.

Mr Lawless said the improved affordability may be attracting buyers to sales, especially for units.

Unit values grew at a faster rate than house values over July, repeating a pattern that’s been prevalent for much of the year, he said.

“Despite an unprecedented amount of new apartment stock entering the market, (unit) values have consistently outperformed the detached housing sector through the downturn, and this trend is continuing into the recovery phase,” Mr Lawless said.

Turnout at auctions has been increasing. Picture: Mark Scott/AAP

CoreLogic’s latest home value index published today showed the inner west was leading the market recovery, posting the highest growth last month, followed by the Hills District.

The northern beaches and Canterbury-Bankstown area were the weakest markets and the only regions where prices continued to fall.

Realestate.com.au chief economist Nerida Conisbee said it was too early to know if the market was bottoming out but it was becoming clear the downturn that started two years ago would soon end.

Originally published as Sydney home prices grow again for second consecutive month