Low mortgage rates, a rise in consumer sentiment and low listing volumes combined to propel national housing values to new record highs in March, according to CoreLogic’s latest Property Pulse report.
At the end of March, the CoreLogic national home value index had risen a further 2.8 per cent, which placed 5.6 per cent above the previous market peak in October 2017.
According to CoreLogic’s data, the combined value of Australian dwellings hit $7.9 trillion dollars over the month.
Despite the overall upswing, some capital cities’ values have yet to surpass their earlier peaks, particularly Perth and Darwin, where values remain substantially below their record highs from 2014.
Conversely, dwelling values in the ACT have hit a new record high every month for the past 19 months.
It has taken 44 months for Sydney dwelling values to reach a new record high. Although values in the NSW capital have lifted 8.1 per cent since the COVID-induced decline, which bottomed out last September 2020, the total value of the dwelling market is only 2.6 per cent higher than the previous peak, which was in July of 2017.
Melbourne values reached a new peak last month, after staging a recovery from the earlier 11.1 per cent drop in values between late 2017 and mid-2019.
The Victorian capital’s housing market was impacted more than any other capital city due to extended social restrictions throughout 2020, and a high exposure to overseas migration as a source of housing demand.
As Melbourne’s stage 4 lockdowns began to ease, the city’s dwelling values have climbed to 0.7 per cent above the pre-COVID high.
Brisbane’s dwelling values are now 6.5 per cent above the previous peak, which was in April 2020.
There was a peak-to-trough decline of -0.9 per cent in market values through COVID-19, which lasted only four months, before the River City’s dwelling values recovered to reach a new record high by October 2020.
Adelaide’s dwelling values have been among the least-affected throughout COVID-19, and following a -0.2 per cent dip from the previous high in May 2020, property values had surpassed the previous peak by September last year.
In March, the rate of change in dwelling values jumped to a monthly increase of 1.5 per cent, the highest monthly growth rate seen across the city since December 2007.
Both house and unit values across the South Australian capital are currently sitting at a record high but although housing values are hitting new highs each month, relative to the larger capital cities, Adelaide housing values remain low.
The CoreLogic home value index for Perth shows values are still 15.9 per cent below the city’s record high, which was in June 2014.
The peak-to-trough decline in the West Australian capital was induced by the rapid withdrawal of mining investment, employment opportunity and migration, and lasted 67 months.
Hobart has had the second-highest uplift in housing values from the previous peak, at 12.3 per cent. The previous peak in dwelling values was in February 2020, before a brief, COVID-induced decline in total dwelling values of 0.3 per cent.
Hobart dwelling values have since experienced remarkably strong growth, with the annualised capital growth return sitting at 9.4 per cent over a five-year period.
Darwin dwelling values are the furthest from the previous peak of the capital city markets, with values sitting 21.6 per cent below their previous May 2014 high. However, since February 2020, Darwin dwelling values have increased 16.5 per cent through to March 2021.
ACT dwelling values at the end of March were 16.9 per cent higher than their previous peak in April 2019. After experiencing a -1.5 per cent peak-to-trough decline, ACT dwelling values had recovered by September 2019, and have hit a new record high each month since.