The upswing in the national property market has continued, with all capital cities recording positive house value growth in the first month of 2020.
According to new CoreLogic figures, Melbourne and Sydney led the charge, with property prices in Australia’s two major cities rising by 1.2 per cent and 1.1 per cent respectively.
December 2019: Australian house prices record the best quarter in a decade
Meanwhile, other cities saw modest growth, with Hobart seeing a 0.9 per cent jump in home values, followed by Brisbane at 0.5 per cent, Canberra at 0.3 per cent, Adelaide at 0.2 per cent and both Perth and Darwin at 0.1 per cent.
This means the annual growth rate is now 4.1 per cent, which represents the fastest pace of growth for a twelve month period since December 2017, according to CoreLogic.
Australian property prices fell for 22 months straight before showing signs of recovery in August last year.
“This demonstrates a broader recovery trend which originally began in Sydney and Melbourne midway through 2019, and gradually spread to other areas of the country,” said CoreLogic head of research Tim Lawless.
Growth slowing, but will continue
Though numbers have improved across Australia’s capital cities, the pace of growth has slowed on a month-to-month basis.
Lawless said that seasonal factors had a hand to play in the monthly slowdown, with CoreLogic’s hedonic index traditionally displaying drops in growth in December and January.
“Factoring in the seasonal affect, the latest results indicate a reduction in the speed of growth across most markets, especially for Sydney and Melbourne where affordability constraints are once again becoming more pressing,” he said.
“As advertised stock levels rise over the early part of the year, we could some further dampening of growth rates.”
However, the growth trend is generally upwards, with housing values improving by 6.7 per cent since hitting a “floor” in June 2019.
Nonetheless, the national index remains 2.2 per cent below the October 2017 peak – but we can expect growth figures to continue improving.
“With housing values rising at the quarterly pace of 3.7 per cent, we are likely to see a nominal recovery in the national home value measure within the next two-to-three months,” said Lawless.
In fact, half of Australia’s capital cities – Brisbane, Adelaide, Hobart, and Canberra – are already showing property prices at record highs.
Sydney will have to see another 5.4 per cent rise before it fully recovers, and Melbourne will have to come back by 1.2 per cent.
Perth and Darwin will take much longer to recover, with these cities at 21.3 per cent and 31.8 per cent below their peak.
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