Brisbane home values slip in June, but not as much as expected

Brisbane home values slip in June, but not as much as expected
Real Estate


Brisbane home values fell 0.4 per cent in June, according to CoreLogic.


BRISBANE home values have slipped for a second straight month amid the economic impacts of the coronavirus pandemic, but not as much as expected.

Melbourne and Perth saw the largest decline in values among the capital cities over June — both recording declines of 1.1 per cent — while Brisbane fell 0.4 per cent to $503,148, according to the latest CoreLogic Home Value index.

On a national basis, home values dropped for the second month in a row, down 0.7 per cent in June, following a 0.4 per cent decline in May.

aerial

Aerial images of suburban houses in southwest Brisbane.


CoreLogic head of research Tim Lawless said the downward pressure on home values had remained mild to date, with capital city dwelling values falling just 1.3 per cent over the past two months.

“So far, the impact from COVID-19 on housing markets has been milder than initially anticipated,” Mr Lawless said.

He said significant price declines had so far been avoided given the low number of homes hitting the market, combined with low interest rates, government support payments and mortgage holidays offered by the banks.

rpdata Research Director Tim Lawless pictured in Sydney on Monday.

CoreLogic research director Tim Lawless.


But he warned the longer-term outlook for the Australian property market remained uncertain.

Commonwealth Bank head of Australian economics Gareth Aird said he was surprised house prices had not fallen more.

“Given the huge negative shock to the economy caused by the COVID‑19 pandemic, it is hardly surprising that prices have eased,” Mr Aird said.

“Indeed what has surprised us is that prices have only contracted nationally by around 1 per cent since March.”

Generic wood Queenslander houses ,needing renovating or renovated Queenslander houses , in Paddington , Brisbane.

Brisbane home values have fallen for a second straight month due to COVID-19.


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In April, the bank’s base case was for a 10 per cent fall in prices due to the pandemic.

“The upshot is that dwelling prices have not fallen all that much so far, which means that there is no material negative wealth effect to date coming via house prices,” Mr Aird said.

“That is very important for the outlook for household consumption and consumer sentiment as falling property prices weigh on overall expenditure.”

Supplied Careers Commonwealth Bank Head of Australian Economics Gareth Aird

Commonwealth Bank head of Australian economics Gareth Aird.


Mr Aird said that while property prices were still likely to ease over coming months, it looked more likely the falls would be more modest than first thought.

“Auction clearance rates have rebounded to reasonable levels at around 65 per cent nationally,” he said.

“And it looks like the impact of significantly lower mortgage rates is largely offsetting the other forces weighing on dwelling prices.”



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