Housing prices are increasing at a faster rate than expected in Sydney and Melbourne, and these gains are starting to be felt in other markets, according to figures from the Australian Bureau of Statistics (ABS).
During the September quarter, house prices in the combined capitals rose 2.4%, driven by gains in Sydney and Melbourne.
Brisbane and Hobart posted positive, albeit more modest, adjustments during the quarter, advancing 0.7% and 1.3% respectively. Single-family homes in the two cities increased the overall value of housing.
The Brisbane detached housing market recorded a slightly higher quarterly growth rate compared to the unit sector, with values ??up 0.9% for homes and 0.4% for units. In Hobart, unit prices remained stable while house prices rose 1.5%.
In Sydney, the value of houses increased 3.6%, driven by gains of 4% in the single-family segment and growth of 2.8% in the unit sector. Melbourne recorded the same growth rate but there is a small difference between the gains in the two sectors.
Read also: Housing price gains planned for 2020
In the markets currently experiencing a slowdown, the rate of decline in the value of housing has started to moderate. Take Adelaide as an example. The city's real estate market has weakened since its peak in the December 2016 quarter and slipped into negative territory during the first quarter of the year. However, in the September quarter, the value of housing in Adelaide fell only 0.3%.
The drop in Perth prices has also eased. Rescued by the 1% rise in housing values, Perth only experienced a 1.2% decline in overall housing values. This could indicate that Perth is finding the bottom of what appears to be a very long recession.
Darwin, which has been trending downward since 2014, continued to improve, with home values ??falling only 1.2% during the quarter. Its unit market, however, remained an obstacle.
On the other hand, the units prevented Canberra's values ??from falling further. During the quarter, the value of dwellings in the city decreased by 0.5% due to the decrease of 1.4% of individual houses. The Canberra unit market recorded a 2.4% increase in its value.
ABS figures reflect what was reported by CoreLogic during the quarter. The recent CoreLogic report attributed the growth in housing values ??to the increased participation of real estate investors.
"Although markets outside of Sydney and Melbourne do not show the same recovery trend, most regions have seen a reduction in the rate of decline or are seeing a modest growth path in the form of low mortgage rates and a slight loosening of credit policies is supporting demand from buyers, "said Tim Lawless, research manager at CoreLogic.
Although there are minor differences between ABS and CoreLogic data, Lawless said the two showed similar trends.
"The housing market is clearly on a solid recovery path in the largest cities, and growth is now spreading to many small capitals," he said.
Main suburbs:
newcastle
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st kilda west
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Torrensville
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Artarmon
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Woolloongabba
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