Housing prices recorded steep declines in the first quarter of the year, along with the number of homes being sold at auction, according to new figures from Australian Property Monitors.
The group has revealed that Sydney and Perth have recorded the biggest declines, where average home prices dropped by $150,000 and $180,000 respectively.
The new figures show that the average price of properties sold at auction in Sydney has dropped to $616,237 from $786,682 in the corresponding period in 2008.
Overall, only 1742 properties were sold at auction, down from the 2230 recorded in the same period 12 months prior.
In Melbourne, the median property auction price has declined to $476,677 from $513,304 last year, while the city recorded just 2251 homes sold at auction, a steep fall from the 3211 recorded last year.
The declines have continued in the smaller markets, with Adelaide only recording 123 properties sold in the first three months of the year compared to 598 in 2008. The median sale price has fallen to $372,000 from $452,000.
Brisbane has also experienced declines, with just 195 properties sold at auction compared to 350 in 2008. The figures show that the city’s median auction price has fallen from $596,571 last year to $439,487.
Prices in Perth have continued to fall, with only 34 properties sold at auction in the first three months of the year while average prices have fallen a massive $184,000 to $372,000.
APM head of research Yvonne Chan says that the residential property market is eroding at the higher end.
“The sales volume in the higher end of the market has reduced, so most of the activity that contributed towards the auction clearance rates in property is in the less than $1 million mark.”
Real Estate Institute of Australia president David Airey agrees, and says it is “unwise” to make predictions about the future of the market when sales volumes are so low.
“It is true that auctions have been very quiet, but that’s been a week-by-week variation. There’s certainly been an improvement in sales of properties between $500,000 and $1 million, but when you get over that, sales are very low,” he says.
“It’s very hard to say there’s been a drop in prices and that we’ve hit the bottom, because we’re working on very small sale numbers. When sales volume is down it’s very unwise to start making predictions.”
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Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
