Property prices in Sydney and Melbourne bounced back last month with both Australian cities reporting a rise of two per cent.
However they eased over the second quarter with a rise of 1.5% in Melbourne and 0.8% in Sydney.
These new figures have suggested that the Australian property market isn’t headed for a crash, with Treasurer Scott Morrison saying that the housing market has “swung back in favour” of owner-occupiers.
“The numbers we have seen today have seen a softening, an easing in the markets in Sydney and in Melbourne, and at the same time a glimmer of hope in markets like Perth, which have been doing it pretty tough for some time,” commented Morrison “We welcome those movements. We also saw data at the end of last week where we saw the pendulum swinging back in favour of owner-occupiers.
“We saw an improvement in owner-occupiers getting into the market and we have also seen bank rates on mortgages for principal and interest falling five, six basis points in recognition of the policies and changes that we have been supporting through the regulator.”
The housing figures came just ahead of the Australian Reserve Bank’s board meeting, where interest rates were expected to remain at a record low of 1.5%.
Add that to the fact that planning permission for apartment blocks was down by 28% compared to May 2016, and the pointers remain strong for homeowners.
Research analyst CoreLogic is expecting price growth to ease to 5-10% for 2017 in Sydney and Melbourne, meaning that there is still some healthy growth to be had, but without the fear of an overheating market.
