SYDNEY, Sept 1 (Reuters) - Growth in home prices across Australia’s capital cities cooled in August, an encouraging outcome for regulators cracking down on potentially risky lending to property investors.
Tuesday’s figures from property consultant CoreLogic RP Data showed dwelling prices across the major cities climbed 0.3 percent in August, following a 2.8 percent surge in July.
Annual growth in home values slowed to 10.2 percent, from 11.1 percent in July. Again, headline growth masked wide divisions between cities with much of the strength concentrated in Sydney.
For August alone, Sydney prices rose 1.1 percent, while Melbourne stalled. Annual gains in those cities were still very high at 17.6 percent and 10.6 percent respectively.
Markets were much cooler elsewhere, with Canberra slipping 1.7 percent in the month and Perth down 1.3 percent.
RPData head of research Tim Lawless warned about reading too much into the slowdown, noting the quarterly and annual trend of capital gains remained high in Sydney and Melbourne.
“The spring season will provide a timely litmus test for the housing market given it’s a time when listing numbers normally increase materially. It will be important to monitor whether buyer demand keeps pace with the additional number of homes being advertised for sale,” he said.
Regulators have reacted to the booming housing markets by tightening lending standards for property investment with the aim of keeping annual growth in credit at 10 percent or less.
The jury is still out on whether these measures will work, although recent data showed growth in credit advanced for housing investment eased to an annual rate of 10.8 percent in July, from 11.1 percent in June, which was the fastest pace in eight years. (Reporting by Ian Chua; Editing by Eric Meijer)