Sydney house price growth up but Melbourne to overtake in spring

Sept 1, 2015| Jennifer Duke| Domain

http://www.domain.com.au/news/sydney-house-prices-up-over-august-but-melbourne-to-overtake-in-spring-20150901-gjc6rf/

Sydney property price growth outpaced all other capital cities in August, but Melbourne is about to knock it off its perch, according to new data.

The Harbour City’s dwelling values crept up 1.1 per cent, while capital cities grew just 0.3 per cent nationally, CoreLogic RP Data’s Home Value Index found.

There was no growth in Melbourne for dwellings in August and a 0.2 per cent decline for apartment values.

​Despite this, auction activity tells a distinctly different story, Domain Group senior economist Andrew Wilson said.

In fact, clearance rates in all major capital cities increased over the past month – with the exception of Sydney.

Melbourne’s clearance rate of 76.2 per cent, ahead of 75.2 per cent in July and up on 71.3 per cent in August 2014, is expected to underpin its market.

A similar story is emerging in Canberra (71.2 per cent), Adelaide (67.8 per cent) and Brisbane (55.6 per cent).

“Melbourne’s heading north and Sydney is heading south,” Dr Wilson said.

“Things are heating up in Melbourne and the results are pretty impressive for other capital cities too,” he said.

Melbourne’s property market strength wasn’t just limited to auctions, it was also the city performing best over the quarter, with dwelling values up 8 per cent, compared to Sydney’s 7.4 per cent.

As the quarterly growth figures are strong, it may be a bit early to predict a slowdown for Sydney or Melbourne just yet, warned CoreLogic RP Data head of research Cameron Kusher.

“In Melbourne we’re expecting a lot more auction strength over spring,” Mr Kusher said.

“There may be a slowing [in Sydney and Melbourne] in six months, but there’s nothing to suggest it will happen now,” he said.

In addition to Sydney, Adelaide and Darwin were the only other cities that recorded increases in dwelling values, at 0.7 per cent and 0.3 per cent respectively, while Melbourne and Brisbane remained flat over August.

All other capitals recorded a fall.