Perth property prices fell in February: CoreLogic

PERTH property prices continue to fall according to the latest CoreLogic Home Value index.

Overall prices fell 1.5 per cent to $438,952 in February, with house prices down 1.4 per cent to $461,890 and units dropping 1.7 per cent to $360,221.

Compared to the same time last year, overall prices have declined 6.9 per cent.

House prices recorded a 6.7 per cent annual fall, while units fared the worst with a 7.7 per cent decrease.

Head of research Tim Lawless said Perth appeared to have caught a second wind in the market downturn with the annual pace of decline previously improving but now worsening.

“This renewed downwards pressure on home values coincides with a softening in labour market conditions, with weaker housing market results likely compounded by credit scarcity,” he said.

Perth was not the worst performing capital city in February, that title went to Darwin with a 1.7 per cent fall.

Annually Sydney recorded the largest drop in prices at 10.4 per cent followed by Melbourne at 9.1 per cent.

Hobart was the best performer over the month and year, recording price increases of 0.8 per cent and 7.2 per cent respectively.

Mr Lawless cited credit availability, high supply, a build-up of stock for sale, fewer foreign buyers and reduced sentiment as some of the factors contributing to the downturn in housing market conditions across the country and there was an expectation values would continue to broadly decline.

This could lead to a cut in interest rates.

“While the rate of decline in Sydney and Melbourne has slowed a little over the month, other cities have weakened,” Mr Lawless said.

“With values expected to fall further, the attention now turns to what impact this could have on future household consumption which accounts for around 60 per cent of the economy.

“If households reduce their spending as the wealth effect continues to reverse, then interest rate cuts or other policy intervention could become more likely.”However, Mr Lawless said it was uncertain how much stimulus lower rates may provide to the housing sector considering the tight servicing criteria and higher funding costs from lenders which would likely prevent any cuts being passed on in full.