Property prices hit new peaks Australia-wide this October
Australia’s property values are showcasing a strong return to form, according to two research firms.
PropTrack and CoreLogic have both announced growth in house prices across every capital city except Darwin over the month of October, pointing to the continued recovery of Australia’s housing markets.
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Looking at CoreLogic’s data, the national Home Value Index (HVI) rose 0.9 per cent over the month, an acceleration from the 0.7 per cent rise seen in September. The firm noted that following on from the “trough” hit in January, the HVI has risen by 7.6 per cent – meaning current figures are just half a per cent below April 2022’s historic high.
At the rate things are going, CoreLogic research director Tim Lawless expects recovery to be “just around the corner”.
He’s pencilled in the forecast for that to occur in mid-November, “recovering from the -7.5 per cent drop in values recorded over the recent downturn between May 2022 and January 2023”.
In PropTrack’s data, Sydney, Brisbane, Adelaide, Perth and regional Australia all hit new peaks in October, with Sydney leading the charge, recovering all of its falls from 2022.
PropTrack senior economist and report author Eleanor Creagh attributed the recent increases to a recent rise in volumes over spring selling season.
She stated “the demand for housing has remained strong, fuelling further home price growth and reflecting the sustained improvement in conditions”.
Explaining further, Ms Creagh said “strong demand stemming from the rebound in net overseas migration, tight rental markets and limited housing stock has offset the impacts of substantial rate rises and the slowing economy”.
Looking ahead, the economist acknowledged a “weaker outlook for the economy”, but does not expect it to impact property price growth.
From her perspective, while interest rates may rise further, “they are likely close to, if not at, their peak”.
“Together with a shortage of new home builds and challenging conditions in the rental market, home prices are expected to rise further,” she forecast.
And while Mr Lawless is expectant of further rises, he does see certain downside risks emerging.
He raised that while housing values are consistently rising across most capital cities, “there’s been a clear slowdown in the quarterly pace of growth trend”.
To illustrate the point, CoreLogic pointed out that across the three months ending June 2023, capital city home values lifted by 3.7 per cent. But since then, growth has drifted back to 2.6 per cent over the three months ending October 2023.
Mr Lawless explained: “The slower rate of appreciation can probably be attributed to a combination of higher advertised stock levels alongside stretched affordability.”
“With an acceleration in the flow of new listings coming onto the market, it’s unlikely buyer demand will be able to keep pace as we move through spring amid high interest rates and low sentiment,” he stated.