TELL ‘EM they’re dreaming.

It’s the sentence plenty of potential buyers could be saying this year as sellers suffer from price point jetlag after 2015 dished up a hot real estate market in some corners of the country.

Just six months ago when prices were riding high in Sydney and Melbourne, sellers were setting the price agenda. But those vendors who took their time deciding to sell, could now be in price shock as values begin to cool.

Cameron Kusher, senior analyst with CoreLogic, said postcodes will play a key role in whether buyers or sellers are in the driver’s seat in 2016.

Skyrocketing property prices in 2015 became a Sydney-based syndrome, with Melbourne riding the wave also.

By the end of 2015, Corelogic reported an 11.5 per cent annual change in dwelling values for Sydney and 11.2 per cent movement in Melbourne. That far outweighed the 7.8 per cent change in dwelling values for all combined capitals.

But according to Kusher, that’s all about to change.

‘Definitely sellers are not going to have it as much their way as they have over last few years in Sydney and Melbourne,’ he said.

‘Most years are years of contrast but generally what we’re going to see is slower growth, buyers will have more choice and sellers will have to be more realistic about their prices,’ he said.

‘This year is not going to be as easy for sellers, certainly not in Sydney and Melbourne,’ he said.

‘But when you move outside those markets, conditions for sellers haven’t actually been that great, generally. You might actually see sellers gain a bit more power in some markets, particularly if people from Sydney or Melbourne start looking elsewhere to buy,’ he said.

While our two biggest capitals look set to have a more lacklustre year than last, Mr Kusher said there were plenty of mini markets where property prices were still on the up and up – even if ever so slightly.

‘I think the south east corner of Queensland, parts the Sunshine Coast, Gold Coast and Brisbane will continue to do well – I’ve got to note, however, that the rate of growth in any of those places isn’t going to hit what we’ve seen in Sydney or Melbourne, but housing demand will pick up in those markets,’ he said.

The analyst said other areas to watch in 2016 include Australia’s regional cities.

‘As people get priced out of Sydney they’ll look to Newcastle or Wollongong. You’ll see more demand going into those markets as well. And similarly in Victoria you might see areas like La Trobe Valley, Bendigo, Ballarat and Geelong have demand starting to pick up as people are priced out of Melbourne,’ he said.

‘And Canberra; we’re also seeing some value rises as well. We’re starting to see a bit more activity coming into the Canberra market. That market hasn’t done very well over the last five or six years,’ he said.

But as Australia is a nation of extremes, so are our diverse real estate markets. Mr Kusher said there were two cities where values could still be heading down.

‘I think Darwin and Perth are on a similar trajectory. You might see the rate of decline slow, but I still think those markets are going to be hamstrung by what’s happening in the resource sector,’ he said.

‘We’re seeing rental rates in those cities fall rather sharply and migration to those markets has slowed rather dramatically, so I think there are some more tough times this year in both of those cities,’ he said.

Posted by Kirsten Craze – on 23rd January, 2016