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Australia’s property market is on track to a full recovery by the end of the year, fresh data shows.
Domain’s House Price Report for the September quarter shows that only about $2000 separates house prices from reaching a new record and $5000 for units across the combined capitals.
The report found that the recovery from the 2022 downturn had moved through its third quarter of growth for houses and second for units, which were up by 1.9 per cent and 1.8 per cent respectively for the September quarter.
It found that although the pace of quarterly growth has eased by a third compared to the previous quarter, prices were now higher annually for the first time in a year for houses and since the middle of last year for units.
Domain’s chief of research and economics, Dr Nicola Powell, said the results for the September quarter confirmed all Australian capital cities were in recovery or at a price peak.
“Sydney continues to lead the recovery, with Brisbane close by,” she said.
“By the end of the calendar year, house prices in Sydney and Brisbane are anticipated to recover fully from the 2022 downturn, reaching new records.
“Adelaide, Perth and Sydney recorded the highest house price gains during the September quarter.
“For units, quarterly gains were steepest in Adelaide, Perth and Melbourne.
“Adelaide and Perth’s house prices are at an all-time high, and for apartments, it’s Adelaide and Brisbane.
“These record-high numbers are driven by a series of factors—interstate migration, record levels of overseas migration, a tight rental market and a chronic undersupply.”
Powell said the pace of growth was being contained somewhat by stretched affordability.
“If mortgage rates weren’t as high as they are (5.98 per cent for a new owner-occupied home loan), price growth would be faster with the current housing undersupply.
“So, for buyers who are in the position of considering purchasing, it is important to weigh up delaying their purchasing timing along with financial planning.”
During the past quarter, choice has also risen for buyers, as sellers regain market confidence and pent-up supply makes its mark.
According to the report, September auction volumes reached a 16-month high and the total national supply was 5.1 per cent above July’s low (6.5 per cent higher across the combined capitals) with new listings in Sydney, Melbourne, Canberra and Hobart higher annually.
“For sellers, as the market recovers, it is about pricing the home correctly ahead of the increasing competition,” Powell said.
Median price of houses and units, September quarter 2023
