Domain’s latest House Price Report has revealed the Australian housing industry has largely bounced back, with all capital cities, aside from Melbourne, recording house price growth over the September quarter.
Unit prices continue to fall, though, across most capital cities, further widening the already-wide gap between houses and units.
Sydney, in particular, now has the largest gap between house and unit pricing pricing on record. (Which we delve into here.)
In the housing realm, there is a lot of movement between states, as various states grapple with the impacts of the pandemic.
Melbourne’s median house price remained at $875,980, while unit prices fell 0.1 per cent to $536,659 over the quarter. This is impressive, given the heavy restrictions the city has been through.
Domain senior research analyst Nicola Powell expects pent-up demand will lead to a short-lived rebound, before we see the true extent of the pandemic impact on Melbourne real estate.
“I do think pent-up demand and supply will see a flurry of activity and that this will support prices,” Dr Powell said.
“It’s something we’ve seen in other countries that have come out of a strict lockdown.
“I think Melbourne house and unit prices have shown incredible resilience over the past quarter.
“But I think we’re not seeing the true economic impact of COVID-19 in the market in Melbourne yet.
“It’s still being propped up at the moment by government support and the banks offering people a break from mortgages.”
Hobart housing prices hit a record high over the September quarter, jumping 6.9 per cent to $555,754 – the steepest leap during a single quarter since late 2017. Annual growth sits at 15.7 per cent.
On the flipside, Hobart’s units fell 9.1 per cent, to $384,672 – the largest unit price dip of all the capital cities, pushing annual growth into negative territory.
Domain notes that Hobart houses could leapfrog those in Adelaide during this current December quarter, with just $9000 separating the two cities. This gap is the smallest on record.
Adelaide house and unit prices are both at record highs, $564,927 and $331,553 respectively.
House prices grew 2.8 per cent over the September quarter – the largest single-quarter jump in seven years, while units rose 4.4 per cent, also the largest leap in seven years.
Perth is now the most affordable city to buy a house in, after Darwin prices surged during the September quarter.
It is the third-most affordable city to buy a unit, behind Darwin and Adelaide. With the gap between unit prices in Adelaide and Perth the smallest it has been since 2004, this could change during this current quarter.
Both Perth house and unit prices increased, up 0.5 per cent and 0.7 per cent, during the quarter, to $534,336 and $335,869, respectively.
House prices recorded the strongest annual gain in six years, up 2.4 per cent, with unit prices falling annually, down 4.5 per cent to $335,869.
Darwin has also had a mighty quarter, rising 6.6 per cent for houses and 4.5 per cent for units, enjoying the strongest quarterly growth for units across all capital cities, and the second-highest housing leap.
Annually, Darwin enjoyed the strongest gain in seven years for houses, up 7.2 per cent to $539,463, and the largest unit price leap in four years, up 7.8 per cent to $326,268.
Canberra house prices rose again during the quarter, up 3.5 per cent to $817,810 – 9.8 per cent higher than the same time last year.
Unit prices fell 2.1 per cent to $447,143, down 2.6 per cent compared to last year.
As Domain’s report notes, Canberra has been “relatively sheltered” from the economic impacts of COVID-19, with a low unemployment rate, along with “historically low interest rates, income support measures, mortgage repayment holidays and financial incentives and heightened demand”.
After a housing value drop during the May quarter, and units falling in price quarter-on-quarter since mid-2019, Brisbane house prices increased 0.4 per cent to $596,316, and unit prices grew 1.7 per cent to $383,585, reversing one-third of the value lost over the June quarter.
Domain notes that, like Sydney, the divergence between housing and unit prices in Brisbane continues: annually, houses were up 3.7 per cent while units were down 6.1 per cent – a median value difference of 55 per cent.
Brisbane buyers are paying “2014 prices” for units, according to Domain.