Melbourne's tough COVID-19 restrictions may be easing but the state capital's housing market remains under pressure.
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New figures show Melbourne house prices fell by a further 0.9 per cent in September and are now 5.5 per cent below a peak recorded in March. Prices are up just 3.1 per cent on the year.
This, and a soft Sydney market, dragged the national value of housing down for a fifth straight month.
Nationally, house prices were down 0.1 per cent in September to be 4.8 per cent up on the year, the CoreLogic Hedonic home value index released on Thursday showed.
The Melbourne and Sydney markets make up around 40 per cent of Australia's housing stock and 55 per cent of their value.
"Melbourne remains the main drag on the headline results," CoreLogic head of research Tim Lawless says.
"With restrictions starting to lift and private home inspections once again permitted, we expect to see activity lift in October."
Still, the national fall in prices was the smallest decline since values started to reduce in May this year.
September also marked a striking turn in housing market sentiment, with consumer confidence increasing, new listings rising and six of the eight capital cities recording a rise in home values in the month.
Even Sydney, where prices fell 0.3 per cent in the month, the rate of decline has been consistently easing. Sydney prices are up 7.7 per cent on the year, the strongest annual rise among Australian capitals.
"The aggregate effect of low mortgage rates, and the prospect that rates could fall further, low inventory levels, government incentives and improving consumer sentiment seems to be outweighing the negative economic shock brought about by the pandemic, " Mr Lawless said.
DWELLING PRICE CHANGES IN SEPTEMBER
Australia - down 0.1 per cent
Sydney - down 0.3 per cent
Melbourne - down 0.9 per cent
Brisbane - up 0.5 per cent
Adelaide - up 0..8 per cent
Perth - up 0.2 per cent
Hobart - up 0.4 per cent
Darwin - up 1.6 per cent
Canberra - up 0.4 per cent
Combined capitals - down 0.2 per cent
Combined regional - up 0.4 per cent
(Source - CoreLogic Hedonic home value index)
Australian Associated Press
