House price slide accelerates as coronavirus pandemic drags on

The coronavirus-induced slide in Australian housing values accelerated last month, as more sellers put their homes on the market.

CoreLogic’s monthly home value index showed a 0.7 per cent fall in values nationally, led by a 0.8 per cent drop in capital city prices.

The biggest capital city falls were in Melbourne and Perth, which both recorded a 1.1 per cent decline, while Sydney had a 0.8 per cent drop in values.

The smaller capital cities — Hobart, Darwin and Canberra — defied the falls elsewhere with modest gains.

However, CoreLogic’s head of research Australia, Eliza Owen, said most analysts are expecting price declines to continue, with a peak-to-trough fall nationally of about 10 per cent.

“There are definitely some headwinds and risks that lie ahead for the market,” she told ABC News.

“These include a sustained rate of high unemployment, with the cash rate unlikely to go any lower, it really does come back to labour market fundamentals to improve purchasing capacity for housing.

“The other major risk is the tapering off of fiscal stimulus and how long banks can sustain easier conditions for people trying to service mortgages amid these job and income losses.”

Although, Ms Owen is not expecting those falls to turn into a full-blown property market crash.

“Economic conditions seem a bit better than what was initially forecast by the RBA and so it is likely that we’re not going to see a housing market crash,” she added.