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‘Boomed’: Why Aussies are feeling so good about the property market

Jessica Yun
·3-min read
A pedestrian crosses a street in The Rocks area of Sydney, Australia, on Tuesday, Oct. 13, 2020.
A pedestrian crosses a street in The Rocks area of Sydney, Australia, on Tuesday, Oct. 13, 2020. (Photographer: Brent Lewin/Bloomberg via Getty)

Australians all across the country are feeling “clear optimism” about the housing market, new data from Westpac has revealed.

According to the latest Westpac-Melbourne Institute Index of Consumer Sentiment, the percentage of Aussies who feel it is ‘time to buy a dwelling’ rose by 10.6 per cent to a level not seen since September 2019.

“Confidence in the housing market has boomed,” Westpac chief economist Bill Evans said.

New South Wales residents revealed a significant surge in optimism, with the index revealing an “outstanding” rise of 11.3 per cent for this state, while Victoria rose by 7 per cent and Queensland rose by 4.4 per cent.

But Aussies from Western Australia and South Australia are the most optimistic about the property market.

“The two states that have traditionally lagged the eastern states in the housing market but which are now dealing most successfully with the virus are standouts with respect to confidence around housing: WA is up 29 per cent [on Westpac’s ‘time to buy a dwelling’ index] and SA has lifted by 10 per cent.”

Property experts also flagged Perth as a rising star, with this housing market described as one of the “busiest markets in Australia”.

CoreLogic figures reveal sellers in this city are becoming listing-happy, with Perth posting 286 new listings in the four weeks to 20 September, a signal of increasing confidence.

National house prices are also expected to rise strongly, Westpac’s index reveals.

“The national Index is now ‘only’ 17 per cent below its pre-pandemic level and back around the level seen in July last year,” said Evans.

“There is clear optimism in smaller states – where housing has underperformed the major eastern states for several years – although the apparent resilience of the Victorian market is impressive.”

How is the property market actually performing?

The reality is, house prices can vary significantly depending on where you’re looking.

CoreLogic’s latest figures show that every single capital city except Sydney and Melbourne recorded increases in house values over the month of September.

Melbourne prices fell by 0.9 per cent, but Sydney prices fell by only 0.3 per cent.

On the other side of the spectrum, Darwin house prices rose by 1.6 per cent in September and Adelaide grew by 0.8 per cent.

Meanwhile, regional areas are emerging as strong property performers, with combined regional markets growing 0.4 per cent.

“Anecdotally we are also observing a transition of demand away from the cities towards the major regional centres, particularly those that are adjacent to the larger capitals where residents can commute back to the cities if required,” said CoreLogic head of research Tim Lawless.

“Remote working arrangements are no doubt a factor in supporting demand in these markets, but lifestyle opportunities and a desire for lower density housing options are also playing a part.”

In August, Hotspotting.com.au managing director Terry Ryder flagged regional areas of Queensland, Victoria, Tasmania and South Australia as delivering “price growth in defiance of the pandemic”.

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