CoreLogic’s NOVEMBER Home Value Index confirms that housing values rose another 1.5% in October, but the pace of growth was marginally slower, as we have seen for the past quarter.
At long last, conditions are improving for buyers, with persistently low levels of housing inventory starting to lift from an extremely low base.
While market conditions remain very strong, some diversity is beginning to appear, with Perth recording its first negative monthly result since June last year – down 0.1%. However, Brisbane is now the nation’s fastest growing capital, with values there rising 2.5% in October. Adelaide and Hobart followed with continued strong growth, each recording a 2% rise in home prices. Sydney and Melbourne’s rate of monthly growth halved, which is an important indicator as to the trend likely to follow across other capitals.
Monthly change in capital city home values
Newly advertised listings surge 47%
You can almost hear the cries of relief from buyers because new listings surged by 47% last month, after the recent low in September. Naturally, this will relieve some of the upward pressure on prices and contribute to the overall slowing trajectory of growth witnessed for the past quarter.
47,040 new listings were advertised in October, representing 22.7% more inventory than was available at this time last year. That’s a result that is also 5.2% above the five-year average.
Nationally, there are 141,786 houses and apartments currently for sale. It’s still a seller’s market but there is a good chance advertised supply will continue to rise through the rest of spring and early summer, creating more choice for buyers.
Regions lead the capital gains
Regional Australia continues to lead the nation’s capital gains, with New South Wales gaining 2.1% and Queensland 1.9% for them month. Western Australia was the only broad rest-of-state region to record a marginal fall in housing values (-0.1%).
However, it is Tasmania that has seen the greatest growth in the past 12 months, leading the nation’s country property prices with a phenomenal 29.1% growth.
Units appreciating at a slower rate
Apartments continue to record lower rates of growth, compared to houses. In Sydney, when units are deducted from the data, houses have risen a staggering 30.4%, whereas units have managed just 13.6%. In Melbourne, it’s 19.5% against 9.2% respectively. This trend is less evident regionally, where the performance gap is much slower.
With affordability now a significant factor for houses, we expect demand to increase for units – particularly as international borders open. The gap between the median price for Sydney houses and units is now a whopping $500,000.
Tightening credit availability is anticipated to begin rebalancing market conditions towards the end of the year.