The REIV’s September quarter market update shows that the median house price in metropolitan Melbourne has dropped to $551,000.
REIV CEO Enzo Raimondo said that concerns about the international economy and negative consumer sentiment have translated into reduced demand and a lower median.
“This serves as another reminder that the state of the housing market is directly linked to the health of the economy. Despite evidence that the local economy continues to outperform many of our trading partners, we are now experiencing a soft housing market.
“The 2.8 per cent reduction on the revised median house price largely reverses the small gains of the June quarter and confirms that, overall, there has been very little capital growth over the past 12 months.
“The median house price in Melbourne has dropped by 2.8 per cent from $567,500 (revised) in the June quarter. The result was similar in the unit and apartment market, where the median dropped by 2.3 per cent from $467,000 (revised) to $465,500.
“The recent trend of reduced demand in the more expensive segments of the market has continued. The effects of the surge in population between 2005 and 2010 are still bolstering demand in the more affordable suburbs.
“Across Melbourne this means that the outer suburbs have recorded an overall better result than the inner ones have.”