An RP Data Rismark Home Value Index report shows February results are a stark contrast when compared to eight successive month-end increases showing housing increases of 10%.
The result was felt across five of the eight capitals with the exceptions of Sydney, Darwin and Hobart.
Prior to February, the past three months saw capital city dwelling values rise 2.6%.
“The likelihood is that the weak reading for February is an adjustment from the strong readings in December and January, rather than the beginning of a flat to negative growth phase across the macro level housing market,” RP Data senior research analyst Tim Lawless said.
The February report shows dwelling values are up 13.2%, since June 2012 when the current growth cycle kicked off, and that recent growth has taken capital city dwelling values to 4.8% than their previous peak in October 2010.
The February report also shows while the month was soft in terms of value, buyer demand, including high auction clearance rates, remained strong making Lawless hesitant to believe the market has begun to slow – yet.
“Our view is that housing market conditions will start to wind down later this year as affordability constraints and low rental yields dampen market conditions,” he said.
“Additionally, with a belief that mortgage rates are likely to start tightening later this year, it may help to quell some of the exuberance we have been seeing."
