Canberra ended 2017 on a high for the property market with dwelling values up one per cent over the final quarter of the year, according to CoreLogic.
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The CoreLogic Hedonic Home Value Index report said the capital's dwelling prices edged 0.2 per cent higher in December and it was 4.9 per cent higher throughout the year.
The report found houses in the capital are rising at more than double the rate of unit values, with house prices up 5.8 per cent over the year while unit prices are only just beating inflation at 2.1 per cent.
National property markets ended 2017 with a whimper, with half of Australia's capital cities recording falling house prices in December. These declines are likely to continue over 2018, according head of CoreLogic research Tim Lawless who said the transition towards weaker housing market conditions had been clear but gradual.
"From a macro perspective, late 2016 marked a peak in the pace of capital gains across Australia with national dwelling values rising at the rolling quarterly pace of 3.7 per cent over the three months to November," Mr Lawless said.
"In 2017 we saw growth rates and transactional activity gradually lose steam, with national month-on-month capital gains slowing to 0 per cent in October and November before turning negative in December."
Among the capitals, the weakest conditions are concentrated in Sydney and Darwin.
Mr Lawless said, "Sydney's housing market has become the most significant drag on the headline growth figures."
Sydney dwelling values were down 0.9 per cent over the month to be 2.1 per cent lower over the December quarter.
Hobart, Melbourne and Canberra had the strongest growth, up 12.3 per cent, 8.9 per cent and 4.9 per cent respectively.
"In 2018, the housing market performance is likely to be significantly different relative to previous years. We're likely to see lower to negative growth rates across previously strong markets, more cautious buyers, and ongoing regulator vigilance of credit standards and investor activity," Mr Lawless said.
- With Jennifer Duke
