Australian property values have continued to rise, with low supply trumping high interest rates and inflation in the price equation.
According to CoreLogic’s national Home Value Index, home values increased 0.6 per cent in April, which was on par with gains in February and March.
The monthly rise has added about $4720 to the national median dwelling value, while over the past 15 months housing values have jumped 11.1 per cent or about $78,000.
CoreLogic Research Director Tim Lawless said there were multi-speed market conditions, with mid-sized capitals leading the pace of growth.
Perth remains at the top of the growth charts with a 2 per cent rise in April, followed by Adelaide at 1.3 per cent and Brisbane at 0.9 per cent.
In Sydney, values increased 0.4 per cent, which was the same rate of growth in each of the past three months.
In Melbourne, the market has largely stabilised, and in April recorded a 0.1 per cent drop in values.
The smaller capitals have emerged from relatively soft conditions, with both Hobart and ACT recording three months of consistent, albeit mild, rises in home values.
“We aren’t seeing any signs of heat coming out of the Perth housing market just yet, in fact the quarterly pace of growth, at 6 per cent, is approaching the cyclical highs seen during the pandemic when interest rates were at rock bottom,” Mr Lawless said.
“On the other hand, we are seeing the pace of gains slow across the Brisbane market, easing below the 1 per cent mark to 0.9 per cent in April for the first time in 12 months.
“Affordability pressures may be impacting the pace of growth across the city, following a nearly $300,000 increase in values since the onset of Covid in March 2020, the largest dollar value increase of any capital.”
The index also showed almost every capital city recorded stronger growth in the lower value range of the market.
Darwin, where housing affordability is less challenging, was the exception, while Sydney’s lower quartile and broad middle of the market showed the same quarterly change at 1.7 per cent compared with a 0.5 per cent rise in upper quartile dwelling values.
“The shift towards stronger conditions across lower value markets can also be seen between the housing types, with growth in unit values outpacing house values over the past three months,” Mr Lawless said.
“Hobart was the only city where houses recorded a larger gain than units over the past three months.”
Regional markets recorded a slightly stronger quarterly growth rate over the past five
months than their capital city counterparts, following a 10-month period where the combined capitals index was outperforming.
Regional WA led the gains, with values increasing 5.3 per cent, followed by regional SA (up 3.9 per cent), regional Queensland (up 3.2 per cent), while regional Victoria was the only rest of state market to record a decline in values over the rolling quarter, down 0.1 per cent.
Mr Lawless said the continued rise in property prices could be drawn back to insufficient housing supply relative to demand.
In the four weeks ending April 28, CoreLogic estimates there were 76,265 homes listed for sale across the combined capitals, which is 17.6 per cent below the previous five-year average.
At the same time, the number of residential sales in April was estimated to be 2.4 per cent higher than the previous five-year average for this time of the year.
“Such a mismatch between available supply and demonstrated demand is keeping markets skewed in favour of sellers in most cities,” he said.
“Capital city homes are currently selling in a median of 27 days compared with the decade average of 30.7 days and most cities are recording lower than average levels of vendor discounting.
“In the hottest market, Perth, homes are selling in a median of just 10 days and discounting rates are averaging just – 2.4 per cent.
“In weaker markets, like Darwin, Hobart and ACT, homes are taking more than 40 days to sell.”
