Those who were proud that Sydney had a million-dollar price tag on its houses may feel deflated this morning. After hitting the benchmark last July, the median price has now dropped to $995,804.

But of greater significance, perhaps, is the extent of the fall in such a short period of time.

The 1.5 per cent drop over the March quarter in the Domain House Price Report, released on Thursday, when coupled with the 3.2 per cent fall in the December quarter, means prices have now dropped 4.7 per cent over six months. It’s an even bigger drop than Sydney experienced over 2008 during the global financial crisis, when the median dropped 4.6 per cent over the full year.

“This is the sharpest correction that I’ve got on record,” Domain Group’s chief economist Dr Andrew Wilson says.

“And there’s every likelihood that we’ll get another drop in June given that auction clearance rates are moderating, banks are tightening their lending rules and buyers and sellers are going to be distracted by an election.”

Yet would-be first home buyers overjoyed that the psychological barrier of the $1 million median house price is no more can hold off on popping the champagne.

The boom’s over, but no crash is imminent. As Dr Wilson points out, the most recent drop is less than the one in December. So there could be an even smaller fall in June. It’s not as if there’s been any major trigger to substantiate a more significant correction, like a large rise in interest rates or a jump in unemployment.

The market’s now simply finding its new level now after the heat of most of last year.

When Sydney reclaims its million-dollar median house price is another question. If Labor were to sneak in with its promise to end negative gearing, investors might jump back into the market to try to beat the deadline of July 1 next year, pushing up prices again. Or there could be a spring revival prompting a million-dollar median again by the end of the year.

One thing’s clear. In the grand scheme of things – when you look at the data over the past 20 years – this little dip doesn’t mean much. The median house price has almost doubled in a decade – it was $527,430 in March 2006. And 20 years ago it was a mere $217,686. How unreal does that sound in today’s world – yet at the time it may as well have been a million dollars.