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Australian home values moved through a 15th straight month of growth in April with CoreLogic’s national home value index rising by 0.1%, on par with the pace of gains recorded in February and March.
Regional markets have shown slightly stronger quarterly growth over the past five months than their capital city counterparts following a ten-month period where the combined capitals index was outperforming.
Looking at value movements over the past 3 months, the strongest regional markets were aligned with the strongest capital cities.
Home sales look to have moved through a cyclical peak in November last year.
Nationally, rents were up 0.8% in April, a slight slowdown in the rate of growth relative to February and March when the national rental index rose by 0.8% and 1% respectively.
Note: At a national level, rents have been rising faster than values since November last year, supporting a rise in gross rental yields.
Housing Trends Across Capital Cities
Now let’s take a look at the housing trends across each of the capital cities.
Sydney
Sydney home values have continued along a modest upward trajectory, rising by 0.4% in April to be 1.3% higher over the first four months of the year.
Note: Sydney dwelling values are now -0.8% below the record high, which was in January 2022.
Melbourne
Melbourne is the only capital city where housing values fell over the first four months of the year, nudging 0.3% lower.
Note: Melbourne dwelling values are now -4.1% below the record high, which was in March 2022.
Brisbane
The pace of growth in Brisbane housing values remains at the high end of the spectrum across the capital cities.
Note: Brisbane dwelling values are currently at a record high.
Adelaide
Adelaide home values increased by 1.3% in April, a subtle slowdown relative to March when the monthly growth rate was 1.4%.
Note: Adelaide dwelling values are currently at a record high.
Perth
The Perth housing market seems to be running its own race with a quarterly rate of growth in home values rising to 6%, the largest increase since the first quarter of 2021 when interest rates were at generational lows.
Note: Perth dwelling values are currently at a record high.
Hobart
Hobart’s housing market has emerged from a near 2-year slump with the past three months recording a consistent, albeit subtle rise in home values to be up 0.8% over the rolling quarter.
Note: Hobart dwelling values are now -11.2% below the record high, which was in March 2022.
Darwin
Darwin housing values were up 0.1% in April, in line with the national average.
Note: Darwin dwelling values are now -5.8% below the record high, which was in May 2014.
Canberra
Canberra housing values have recorded three months of consistent but subtle growth with values up 1% over the rolling quarter to be 2.1% higher over the past twelve months.
Note: Canberra dwelling values are now -6.0% below the record high, which was in May 2022.
Housing Supply and Demand
The persistent rise in housing values despite an array of downside factors that would normally act to push prices lower can be drawn back to the insufficient supply of housing relative to demand.
There are a few ways to measure housing supply.
Such a mismatch between available supply and demonstrated demand is keeping markets skewed in favour of sellers in most cities.
We can also see evidence of low supply in the number of homes being built.
Note: In the meantime, it looks as though interest rates could stay higher for longer.
With high interest rates, the recent upside surprise on inflation, a gradual loosening in labour markets, and growing housing worsening risk profile, housing values are likely to be propped up by the mismatch between housing supply and demand, a situation that doesn’t look like it will change in the near future.
ALSO READ:
Perth Housing Market Update [Video]
Adelaide Housing Market Update [Video]
Sydney Housing Market Update [Video]
Brisbane Housing Market Update [Video]
Melbourne Housing Market Update [Video]
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