Residential property prices in Australia have grown fastest rate since 2004

Australia’s housing market breaks a 17-year high as home prices skyrocket

Residential property prices in Australia increased 13.5 percent in the 2020/21 financial year, the highest annual growth rate since 2004, when the market was unwinding from the early 2000s housing boom.

In June, the CoreLogic home value index increased by 1.9 percent, with prices increasing in all capital cities, led by a 3% increase in Hobart.

House prices increased 15.6 percent year over year, while unit prices increased 6.8 percent.

Darwin experienced the highest annual increase in dwelling values, at 21%, followed by a 19.6% increase in Hobart.

Eliza Owen, head of research at CoreLogic, said there were numerous factors driving the housing market in the first six months of 2021, prior to the recent uncertainty surrounding the growing COVID-19 cases across the country.

Continued low mortgage rates, declining unemployment, increased consumer confidence, savings accrued last year as a result of COVID restrictions, and a relatively low advertised housing stock all contributed to the current state of strong demand.

“However, there are some markets where performance has begun to deteriorate significantly,” Ms Owen explained.

Perth and Darwin are losing momentum, while softer growth rates are emerging at the top end of the market.

“This slowing of growth at the top end of the market is yet another clear indication of a change in momentum,” Ms Owen said.

“The rest of the market typically moves in lockstep with the high end, and this is the first time in nine months that the high-tier growth rate has slowed.”

JUNE CORELOGIC NATIONAL HOUSE VALUE INDEX

(month, annual)