Insights Into The Current State Of Australia’s Housing Market: March 2024
In March, CoreLogic’s National Home Value Index (HVI) continued its upward trajectory with a 0.6% increase.
This marks the 14th consecutive month of housing value appreciation.
Following a decline of -7.5% between April 2022 and January 2023, the national HVI has surged by a massive 10.2%, equivalent to approx. $71,832.
This surge has propelled housing values to new record highs each month since November last year.
With the exception of Darwin (-0.2%), all capital cities experienced a rise in dwelling values. Some of the more significant month-on-month increases were seen in Perth (1.9%), Adelaide (1.4%), and Brisbane (1.1%), while Melbourne recorded a negative quarterly movement of -0.2% over the first three months of the year.
The quarterly pace of national growth has accelerated from 1.4% in Q4 last year to 1.6% in Q1 this year. Despite this acceleration, the rate of growth has halved compared to the middle of the previous year.
CoreLogic’s Research Director, Tim Lawless attributes the softer housing conditions since mid-last year to factors such as rate hikes, cost of living pressures and worsening housing affordability. However, he emphasises that an undersupply of housing relative to demand has and continues to exert upward pressure on home values.
The extreme growth conditions in Perth, despite rapid capital gains, are explained by relatively affordable housing compared to larger capital cities. High purchasing demand, fueled by interstate and overseas migration rates well above average, further increases this pressure.
The shift in demographic trends, particularly in Western Australia, has led to significant positive demand across housing markets. The strongest growth conditions have transitioned from the upper range to the lower range in most capital city markets, reflecting increased demand in the middle-to-lower end of the value spectrum due to challenges in housing affordability.
Regional housing markets have shown similarities to their capital city counterparts, with Regional Victoria also experiencing the softest growth conditions. However, overall, regional markets are also seeing a rise in values.
Although home sales in the first quarter of the year are estimated to be 9.5% higher compared to the same period last year, Lawless notes that this comparison is from a relatively low base, considering the housing market’s bottoming out at the beginning of last year. Nonetheless, sales are estimated to be 3.7% higher compared to the previous decade’s average for this time of the year.
For property investors, the current state of the Australian property market presents an ideal time to leverage the market’s growth potential and diversify their investment portfolios.
By making informed investment decisions, embracing the opportunities inherent in the Australian property market, and partnering with property professionals such as AllianceCorp, investors can navigate the complexities of the market with confidence.
To explore your investment options and receive personalised guidance, request a complimentary discovery session with one of our Senior Property Wealth Planners below!