Housing recovery gathers momentum through first month of spring, with national dwelling values up 0.9%

Posted By Shiral Alexander

Housing recovery gathers momentum through first month of spring, with national dwelling values up 0.9%

The CoreLogic September home value index results saw the national index post the largest monthly gain since March 2017, largely driven by a strong rebound in Sydney and Melbourne where values were up.

The September gains were once again driven by stronger conditions emanating from Sydney and Melbourne where dwelling values increased by 1.7% over the month; Australia’s two largest cities have seen a rapid bounce-back in home values over the past two months, with Sydney up a cumulative 3.3% and Melbourne up 3.2% in August and September. Housing values remain 11.9% below their July 2017 peak in Sydney and 7.9% below Melbourne’s November 2017 peak.

Mr Lawless believes that the strong rebound in Sydney and Melbourne housing markets relative to other regions, can be attributed to a variety of factors. He said, “While all regions are benefitting from low mortgage rates and improved access to credit, economic and demographic conditions in New South Wales and Victoria continue to outperform most areas of the country. Population growth is higher, unemployment is lower and jobs growth is stronger, providing a solid platform for housing demand.” Another factor cited by Mr Lawless as driving the strength in Sydney and Melbourne property markets could be higher levels of investor participation. The latest housing finance data from the ABS (to end of July) shows investors comprised 32% of mortgage demand across New South Wales and 26% of Victorian mortgage demand which is higher relative to any of the states or territories.

Source: Tim Lawless, 1 Oct 2019