Thursday, July 4, 2024 05:49 PM
CoreLogic Reports Surge in Australian Home Prices
- National home prices rose by 0.8% in May, marking sixteen months of growth.
- Limited housing supply shields market from external factors like high interest rates.
- Scarcity of available housing leads to price increases in major cities.
Image Credits: thefrontierpostAustralian home prices surged in May due to a persistent housing shortage, driving prices up. CoreLogic data shows a robust property market with limited supply and high demand, highlighting ongoing affordability challenges.
Australian home prices experienced a significant surge in May, with the largest monthly increase since October. This rise is attributed to the persistent shortage of affordable housing in major cities across the country, which continues to drive prices upwards.
According to data from CoreLogic, national home prices increased by 0.8% in May, marking sixteen consecutive months of growth. Year-on-year, prices are now 8.3% higher compared to the previous year, showcasing the robustness of the property market.
The Research Director at CoreLogic emphasized that the limited housing supply has acted as a shield against external factors such as high interest rates, living costs, and negative consumer sentiment. The market has displayed resilience, with new listings meeting demand swiftly, maintaining low stock levels, and pushing prices higher.
The scarcity of available housing is evident in the low number of homes advertised for sale in recent weeks. This shortage has led to price increases in state capitals, with Perth rising by 2.0%, Adelaide by 1.8%, and Brisbane by 1.4% in May. Sydney also saw a 0.6% increase, matching a previous record set earlier this year.
Following a significant decrease, Sydney's property values have rebounded by 14.1%, nearing a median value of A$1.16 million. Melbourne experienced a slight 0.1% increase, while Canberra saw a 0.5% rise. A Reuters poll predicted that Australian home prices would surpass overall inflation in the next two years, attributing the expensive housing market to builders' failure to increase supply.
Despite a rise in vendor activity, inventory levels in key markets remain below average, contributing to the ongoing price hikes. This imbalance underscores the persistent challenges of housing affordability in Australia.
The surge in Australian home prices in May reflects the impact of a continued housing shortage in major cities. As prices continue to rise, the housing market remains resilient, driven by limited supply and high demand. However, the affordability challenges persist, highlighting the need for sustainable solutions to address the housing crisis in Australia.
