National home prices have cycled through 17 months of consecutive growth after lifting 0.3% to hit a new record in May, according to the latest PropTrack Home Price Index Report. This brings dwelling prices up 2.73% year-to-date.
Strong population growth, tight rental markets, and home equity gains all contributed to demand, while the supply side of the housing market continues to fall short.
Prices are 6.68% above May 2023 levels and up 9.58% from their December 2022 low.
Prices in the combined capital cities rose 0.41% to a new peak in May. Capital city prices are now up 7.22% year-on-year, though performance has diverged between capitals as well as regional areas.
Median House Prices also Increase
Australian home values continued to trend higher in May with Corelogic’s National Home Value Index (HVI) rising 0.8%.
The median house price in Australia’s combined capital cities is now $975,592. The median unit price in Australia’s capital cities is $669,434.
The median dwelling value in Australia’s combined regional areas is $626,888 but of course, there are markets within markets, so speaking to an expert in your region is paramount to gaining in depth knowledge in your area.
The stable interest rate environment has likely been a driver of confidence among buyers and sellers, and with housing supply unable to meet demand across the country, home prices reached a fresh peak in May as robust demand has continued to push prices upwards.
Further, ongoing home price rises are likely incentivising many to overcome affordability challenges and transact with the expectation of continued growth.
Meanwhile, the supply side of the housing market has fallen short in responding to substantial demand. Building activity is at decade low levels, exacerbating the housing supply shortage. If you’ve been considering selling your property, now may be the time to speak to an agent about price potential.
What next for Australian property?
This imbalance between supply and demand has offset the higher interest rate environment and deterioration in affordability and is expected to continue to do so.
Inventory levels in these markets remain well below average despite vendor activity lifting relative to this time last year. Fresh listings are being absorbed rapidly by market demand, keeping stock levels low and upwards pressure on prices.
Despite some easing in the rate of population growth and more stock on market, home prices are expected to lift further in the months ahead. If you’re ready to buy or sell your property, we understand that you may require assistance with this journey in a fluctuating market and your local Elders office is here to help.
Whether you’re looking to buy, sell, rent, or invest, you can rely on Elders and our local knowledge to guide you through the process. Contact an Elders agent in your area here.