Sydney, Melbourne housing prices tipped to fall another 5%

"By contrast home prices in Perth and Darwin are either at or close to the bottom, price growth is likely to be moderate in Adelaide and Canberra, but it may pick up a bit in Brisbane thanks to stronger population growth and the boom in Hobart has a way to go yet," Dr Oliver said. "Consistent with the fall in Sydney and Melbourne property prices, auction clearance rates and home sales have also fallen."

Sydney's auction clearance rate was 67.1 per cent, with 775 homes going under the hammer during the week to April 8, CoreLogic says. This is markedly lower than the same period a year ago where 1436 homes were up for auction and 77.7 per cent sold.

As for Melbourne, 69.6 per cent of the 720 homes auctioned last week were sold compared with 79.3 per cent of 1488 auctions in the same period a year ago.

Dr Oliver said the surge in the number of apartments, notably in Sydney, was largely behind the fall in home values and was raising concerns about an oversupply. He said this has also spurred calls and stories of a pending housing market crash, which in technical terms meant a 20 per cent fall in the national average home value. "But a crash remains unlikely," Dr Oliver predicts.

AMP's Shane Oliver said the surge in the number of apartments, notably in Sydney, was largely behind the fall in home values.
Photo: Louise Kennerley

He said supply had not kept up with population growth and housing demand over the last decade and it was dangerous to generalise, because while Sydney and Melbourne property prices had surged in recent years, they had fallen in Perth and Darwin and been steady in other capital cities.

AAP

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