Australia Property

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(Bloomberg) -- Sydney’s property market slump has reached a new milestone, with values falling further than the late 1980s when Australia was on the cusp of entering its last recession.
Average Sydney home values have fallen 10.1 percent since their 2017 peak, CoreLogic Inc.’s head of research Tim Lawless said Tuesday, citing data as of Dec. 7. That surpasses the top-to-bottom decline of 9.6 percent recorded between 1989 and 1991.
The declines in Australia’s most populous city are accelerating as tighter mortgage lending standards crimp the amount people can borrow and as nervous buyers sit on the sidelines. While local policy makers are monitoring the market closely, none appear nervous of an outright crash.
Sydney was the epicenter of a five-year boom and prices are still more than 60 percent higher than they were in 2012. That means few existing homeowners are underwater, and the major banks, which dominate about 80 percent of the mortgage market, have plenty of buffer before losses would bite.
“We are obviously past the cycle peak in housing and prices naturally are coming off,” Craig Vardy, BlackRock Inc.’s head of fixed income for Australia, said at a briefing in Sydney on Tuesday. “Moderation in the housing market is expected to continue.”
Vardy said that the housing slump could be “prolonged” over the next 12 to 18 months and national house prices could fall another 10 percent.

Separate data from the Australian Bureau of Statistics on Tuesday showed Sydney prices fell 1.9 percent in the three months to the end of September, the worst quarterly performance since March 2005.