Housing prices fall around country, Sydney cheaper than a year ago

Housing prices fell in almost every capital city last month while Sydney prices are now lower than they were a year ago.

New homes in western Sydney. Pic: AAP

Housing prices fell in almost every capital city last month as the once white-hot market continues to come off the boil.

Sydney prices are now lower than they were a year ago, with the city dropping 0.5 per cent over the past 12 months and recording an annual price fall for the first time in 2012.

The harbour city was the weakest capital over the quarter, dropping 2.4 per cent, and also fell 0.6 per cent during February, according to CoreLogic.

National dwelling values fell 0.2 per cent in February and have now fallen for five months in a row for the first time since March 2016.

Housing price growth has been weakening amid a regulatory crackdown on lending to investors and risky borrowers, which has hit the investor-driven market of Sydney hardest.

Melbourne has been more resilient but still recorded price falls of 0.1 per cent in February, and a decline of 0.4 per cent during the quarter.

“To date, the pullback in values has been quite moderate, especially in light of how strong value growth has been over recent years,” CoreLogic head of research Tim Lawless said.

“Considering the tighter credit environment, the eventual prospect of higher interest rates and ongoing housing affordability constraints, we expect housing market conditions will remain sedate relative to previous years.

“The reversal in capital gains has been mild to date, a clear sign that macroprudential measures have removed the heat from the market in a very controlled manner.”

In February, the only market to rise was Hobart, up 0.7 per cent, while Adelaide was flat.

Brisbane fell 0.1 per cent, Perth lost 0.2 per cent, Canberra fell 0.3 per cent and Darwin dropped 0.9 per cent.