CoreLogic monthly data suggest property market has found a floor and may be heading into positive territory

Rises in property prices suggest the market has found a floor and may be heading into positive territory | How your city performed

Row of For Sale signs in Gwandalan, Central Coast NSW. House auction signs. Real estate.

Rises in property prices in Sydney, Melbourne and Brisbane in July suggest the market has found a floor and may be heading into positive territory as a combination of interest rate cuts, improved access to credit and political stability drive confidence.

Prices rose 0.2 per cent in Sydney, Melbourne and Brisbane in July with Hobart (up 0.3 per cent) and Darwin (up 0.4 per cent) also in positive territory according to CoreLogic’s Hedonic Home Value Index. Adelaide, Perth and Canberra reported falls.

CoreLogic’s Australian head of research Tim Lawless said the multiple market changes of the past three months has created a stronger playing field for vendors.

“The fact that we have seen five of the eight capitals, and three of the regional markets recording a rise over the month, I think it’s a pretty good sign that the positive stimulus that we’ve seen coming through the economy and through policy is starting to roll through into the market and having a very positive impact on consumer sentiment towards housing,” Mr Lawless said.

National property prices achieved the best result since October 2017 which was the last time the market experienced a neutral to positive reading.

Housing turning the corner in Australia.

The most significant influencing factor was the continued improvements in the Sydney and Melbourne markets, which slowed through the first half of the year before gaining slightly in June. Brisbane recorded its first month-on-month rise since November 2018.

“I don’t think this is a blip,” said Mr Lawless. “The reality is we’ve been seeing a pretty consistent trend towards stabilisation throughout 2019 and that’s culminated in very subtle positive movements over the past few months across the larger cities.

“My guess is the remainder of the year will probably show ... more cities starting to demonstrate this stabilisation trend that we’ve seen start in Sydney and Melbourne.”

Units outperformed houses Sydney and Melbourne over the past three months. Sydney house prices were down -0.2 per cent over the quarter, while unit values showed a slight rise of 0.02 per cent. The difference was more stark in Melbourne where house values were down 0.3 per cent over the same period, while unit values were 1.1 per cent higher.

But Mr Lawless warned the spring selling season would be a test for the market. The number of properties new listed around the country has fallen 25 per cent from July last year, while total levels are 5 per cent lower.

While increased competition among buyers has supported higher prices, predicted increases in the number of properties in the coming months may have an impact.

“Without a doubt spring will be the real test for the market. I think there’s been a great deal of pent up demand from vendors, in the sense that we’ve seen a very small number of properties being added to the market as vendors sit on their hands,” Mr Lawless said.

Industry expectations are for a lot of pent up demand being unleashed around spring and the test will be whether buyer demand rises to match additional supply.

“My guess is we probably will see some subtle [price] rises through spring. I’d be really surprised if we saw an acceleration in the pace of capital gains as more stock comes on the market… I think the recovery trend is going to be quite drawn out.”

The results in the rest of the country showed the trend of stabilisation is widespread.

In regional Australia, outback areas continue to be the weakest performers in the country but are slowly improving.