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House prices in Melbourne rose 8.8 per cent in the past year while Sydney prices fell, according to the Domain House Price Report.
In its first quarter update, Domain reports the median price for a detached house in Melbourne at the end of March was $914,518, up from $840,903 a year ago. Sydney's $1.15 million median price is down 1.4 per cent on the $1.17 million reported a year ago.
Unit prices followed a similar trend. Melbourne's unit prices rose 7.9 per cent to $505,861 while Sydney prices fell 0.6 per cent to $740,041.
The price gap between the two cities is the smallest in almost four years.
"While Sydney is currently dealing with the impact of decreased investor activity, Melbourne has always been an owner-occupier led market, somewhat less exposed to investor movements," said Domain data scientist Dr Nicola Powell.
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"Ongoing price growth in the Victorian capital is being supported by the city's rising population, strong employment growth and lower affordability hurdles.
"Although there are certain pockets of Melbourne impacted by heightened unit supply, overall the city delivered the strongest annual growth in eight years."
Hobart is also enjoying a late-cycle surge with median prices up 15.5 per cent in the year to March, albeit from a lower price base of about $400,000. The city has moved against the trend on the east coast where prices are moderating, as it picks up on price-fatigued demand from Sydney and Melbourne.
Hobart's median unit price is now higher than those in Adelaide and Darwin, according to Domain.
"Hobart once again delivered remarkable results over the March quarter for both houses and units," Ms Powell said.
"The Tasmanian capital continues to flourish as Australians and overseas buyers seek an affordable market with desirable lifestyle factors, and all signs point to further growth in the coming months until the supply response can alleviate housing demand."
Brisbane, Adelaide and Canberra recorded moderate price rises of between 1.5 and 3.7 per cent.
Nationally, the median house price increased 2.3 per cent over the year to March, the lowest rate of growth since 2012, Domain reports. Detached home prices fell more than units, with unit prices offering a lower barrier to entry to buyers.
"Nationally, the annual pace of growth for houses and units slowed to a five and a half year low," Ms Powell said.
"Drivers such as employment growth, new housing supply, affordability hurdles, tightening credit policies and out-of-cycle rate hikes have made their impact, however the effect on property prices varies from city to city."
This corresponds to similar trends to CoreLogic median prices although the quantum is different as data collation methods differ between the two groups.
At the end of March, Sydney's overall median price was $878,325 according to Corelogic, up 9 per cent from the year before, while Melbourne's median price was $720,881, up 19 per cent.
Read more: http://www.afr.com/real-estate/melbourne-house-prices-up-88-per-cent-sydney-prices-fall-20180416-h0yu8n#ixzz5Dl5XAoR3
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