First Home Buyers could be back In fact, both the national figure and the NSW numbers are at nine-year lows. Included in this data release is the proportion of loans to first home buyers. In NSW, this proportion seems to have bottomed out, bubbling along just above the low of 16 per cent seen in March.

House prices for the June quarter continued growing but at a slowing rate. This was a good result for existing home owners. Some of this strength was due to investors continuing their return to the market, as evidenced by the increase in investor finance in the past 12 months, filling the gap left by exiting first home buyers and other owner-occupiers.

However, this trend reversed in the June numbers, with the value of loans to investors falling significantly for the first time in nearly a year. So, while auction clearance rates and first home buyer numbers seem to have stabilised, it’s very likely the drop in demand for loans for owner-occupied and investor housing will translate into flat or falling prices across Sydney during the spring season.

Indeed, a closer look into June-quarter house prices showed that in the month of June, prices did fall slightly across Sydney as a whole. Of course, a pause in growth or some orderly declines in prices is good news for aspiring owners and probably necessary to encourage first home buyers back.

Matthew Bell is the economist for the Fairfax-owned Australian Property Monitors.