Australia’s residential property market has hit a new high, reaching a total value of $11 trillion. This growth represents an increase of $900 billion over the past year, according to CoreLogic’s latest housing report.
Property Market Prices: Slower but Still Growing
While the market value has grown, home prices themselves rose only by 1.0% in the September quarter, showing the slowest increase since early 2023. The annual growth rate also dropped to 6.7%, cooling down from 9.7% earlier this year. This change is largely due to more properties hitting the market and cautious buyers, says CoreLogic economist Kaytlin Ezzy.
State-by-State Breakdown
- Perth: Leading with a 24.1% increase, driven by high demand and limited availability.
- Sydney, Brisbane, Adelaide: Record-high values, with Brisbane up by 14.5%, Adelaide by 14.8%, and Sydney by 4.5% over the past year.
- Melbourne and Hobart: Experienced declines, now down from their highs in early 2022.
In regional areas, property values rose by 1.0% over the last quarter but showed a similar slowdown as seen in capital cities.
Factors Impacting the Market
The increase in property listings has given buyers more options, which has slowed down the pace of price growth. However, buyer interest remains strong, with a 10.5% increase in sales compared to last year.
Investors are particularly active, accounting for 38.6% of new loan applications, the highest level since 2017. This uptick comes despite slower rental growth, with rents rising only 0.1% in the quarter, the lowest in four years.
Key Highlights from CoreLogic’s October Report
- Market Value: Total residential real estate in Australia is now valued at $11 trillion.
- Quarterly Price Growth: Only a 1.0% increase, the slowest rise since March 2023.
- Investor Interest: Investors represent a large portion of buyers, attracted by potential capital gains and rental income.
- New Listings: Up by 2.1% year-on-year, giving buyers more options and easing some competition.
- Rental Market: Rental growth has slowed to 6.8% annually, down from 8.5% earlier this year.
As the market adjusts with new listings and cautious buyers, the spring season might bring more stable growth, providing opportunities for buyers who’ve faced tough competition over the past year.
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