CANBERRA, AAP – A lift in house values in the smallest cities has driven growth across the country, despite stalling values in Sydney and Melbourne.

CoreLogic’s national Home Value Index released on Friday was up 0.7 per cent in March, driven by stronger conditions in Brisbane, Adelaide, Perth and the ACT, along with several regional areas.

This offset a slip in values across Sydney and Melbourne.

Australian dwelling values rise by 2.4 per cent in the first quarter of the year, adding about $17,000 to the value of a home.

A year ago, values were rising at more than double the current pace, up 5.8 per cent over the three months to March 2021, before the quarterly rate of growth peaked at seven per cent over the three months ending May 2021.

Sydney’s growth rate fell from a peak of 9.3 per cent in the three months to May 2021, to 0.3 per cent in the first quarter of this year.

Melbourne’s housing market has seen the quarterly rate of growth slow from 5.8 per cent in April last year to 0.1 per cent in the past three months.

CoreLogic research director Tim Lawless said there was mounting evidence housing growth rates were losing momentum.

“Virtually every capital city and major rest-of-state region has moved through a peak in the trend rate of growth some time last year or earlier this year,” Mr Lawless said.

“The sharpest slowdown has been in Sydney, where housing prices are the most unaffordable, advertised supply is trending higher and sales activity is down over the year.”

Exceptions to the trend include regional South Australia and Perth.

Mr Lawless said the annual growth trend would fall sharply in the coming months, as the strong gains recorded in early 2021 dropped out of the 12-month calculation.

National housing turnover is also easing, with preliminary transaction estimates for the March quarter tracking 14.3 per cent lower than the same period in 2021, but still 12.2 per cent above the previous five-year average.

Regional dwelling values increased 5.1 per cent in the three months to March, compared with the 1.5 per cent increase recorded across the combined capital cities.

The Australian Bureau of Statistics reported on Thursday that residential property prices rose 4.7 per cent during the quarter, reflecting record low interest rates, the labour market recovery and strong demand for housing.

Separate ABS data on Friday showed a 3.7 per cent decline in housing loan approvals in February, compared to economist forecasts for a 1.5 per cent increase.

Approved housing loans had jumped 2.6 per cent rise in January.

The sharp drop in February to a seasonally-adjusted $32.3 billion was mainly driven by a 4.7 per cent fall in the value of owner-occupier home loans – the first since October 2021.

The decline was seen across most states and territories, with NSW down 10.5 per cent) while Victoria dropped 5.2 per cent. The ACT recorded a 23.6 per cent slide.

The value of home loans to investors also fell 1.8 per cent to $10.8 billion – the first such decline since October 2020.

CORELOGIC NATIONAL HOME VALUE INDEX FOR MARCH

(month, annual)

National – up 0.7 per cent, up 18.2 per cent

Sydney – down 0.2 per cent, up 17.7 per cent

Melbourne – down 0.1 per cent, up 9.8 per cent

Brisbane – up 2.0 per cent, up 29.3 per cent

Adelaide – up 1.9 per cent, up 26.3 per cent

Perth – up 1.0 per cent, up 7.0 per cent

Hobart – up 0.3 per cent, up 22.3 per cent

Darwin – up 0.8 per cent, up 10.6 per cent

Canberra – up 1.0 per cent, up 21.6 per cent

Combined capitals – up 0.3 per cent, up 16.3 per cent

Combined regional – up 1.7 per cent, up 24.5 per cent