Australia Property Prices Fall for Ninth Month on Tighter Credit

(Bloomberg) -- Australian housing prices fell for a ninth straight month in June as tighter credit rules weigh on buyers.

Property values fell 0.2 percent nationally last month, to be 1.3 percent lower than their September peak, according to CoreLogic Inc. data released Monday. The decline was led by the biggest cities, with prices falling 0.3 percent in Sydney and 0.4 percent in Melbourne.

Under pressure from regulators, banks have been cutting back on riskier loans such as interest-only mortgages, and getting tougher on expense and income verification. That's hit the hardest in expensive markets like Sydney, where affordability is most stretched. Falling prices are also deterring investors, who no longer see good prospects for capital gains.

Read more: How Australia's banks became addicted to property

“Tighter finance conditions and less investment activity have been the primary drivers of weaker housing market conditions, and we don't see either of these factors relaxing over the second half of 2018,” CoreLogic's head of research Tim Lawless said.

To contact the reporter on this story: Emily Cadman in Sydney at ecadman2@bloomberg.net

To contact the editors responsible for this story: Marcus Wright at mwright115@bloomberg.net, Peter Vercoe

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