House prices have increased in almost every capital city, bouncing back from recent price falls, according to the June quarter Domain House Price Report.
Nationally, the median house price increased 1.5 per cent, with strong growth in Sydney, Melbourne, Brisbane, Adelaide, Canberra and Hobart. The exceptions are Perth and Darwin, where steep price falls continued, decreasing 1.7 and 0.7 per cent, respectively.
Overall, median unit prices have increased, but record levels of apartment building have led to oversupply in some capital cities, delivering mixed results across the nation.
Key results in the June Quarter Domain.com.au House Price Report:
Sydney median house price back up over $1 million
Median house prices hit new record in Melbourne, Adelaide and Canberra, with solid price increases for Sydney, Brisbane, and Hobart
Canberra is the top market performer for price growth
Prices continue to fall in Perth and Darwin
National median house price up 1.5 per cent over the quarter, 2.7 per cent year-on-year
Sydney’s median house price rose to $1,021,968 this quarter, increasing by 2.4 per cent, once again breaking the $1 million mark. Although prices are high, they remain below the capital’s record level of $1,032,899, reported in September 2015. Sydney house prices have increased 1.2 per cent over the past year – the lowest annual increase in 4 years.
Sydney unit prices increased to $669,830, a 0.6 per cent quarterly growth and an annual increase of 0.4 per cent, which is the lowest yearly growth since December 2011.
“Last quarter, Sydney house prices dropped below $1 million, but they have bounced back as lower interest rates boost market confidence. The current growth rates are significantly lower than the rises during Sydney’s property boom but, with the revival of investor activity, it’s likely there are more increases coming for the capital,” said Domain Chief Economist, Dr Andrew Wilson.
Melbourne median house prices have hit a record high of $740,995, an increase of 1.5 per cent. While the June quarterly increase is marginal, Melbourne prices have increased for twelve consecutive quarters and grown a staggering 7.4 per cent over the past year.
Melbourne unit prices have risen to $450,933, a quarterly growth of 3.5 per cent and an annual increase of 2.7 per cent.
“Melbourne’s growth over the past year is the strongest result in the nation. The new record for median prices reflects the robust market, strengthened by rising buyer and seller confidence,“ said Domain Chief Economist, Dr Andrew Wilson.
The Brisbane median house price has increased to $521,915, over the June quarter, a 1.2 per cent increase. The 4.3 per cent annual increase is a solid result, consistent with Brisbane’s steady rise in recent years.
Median unit prices continued to fall, declining by 1.8 per cent to $370,251. With an annual decline of 3.2 per cent. Brisbane unit prices are now at the lowest point since the March 2013.
“The upswing in house prices is a promising sign for Brisbane homeowners and investors,however the eighth consecutive quarter of median unit price falls clearly suggests that oversupply and weak demand continue to impact the market,” said Domain Chief Economist, Dr Andrew Wilson.
Median house prices in Adelaide have hit a record high, rising to $498,927. House prices increased 0.9 per cent over the June quarter and a solid 4.4 per cent over the year.
Adelaide median unit prices continued to fall, declining by 1.7 per cent to $294,165. Annual price growth in the capital is up by 0.1 per cent.
“Adelaide is a split market, with house prices on the rise and unit prices lagging. The recent surge of new apartment construction has left the local market sluggish, surpassing the demand from buyers,” said Domain Chief Economist, Dr Andrew Wilson.
Perth median house prices have continued to fall in the June quarter, declining by 1.7 per cent to $568,132. This is the sixth consecutive quarter of price falls for the capital, with the median price now at the lowest point since March 2013. Over the past year, Perth house prices have fallen by 5.6 per cent – second only to Darwin for poor market performance.
Perth median unit prices fell to $367,025, down by 2.4 per cent over the quarter and 7.8 per cent annually.
“Like many of the capital cities, Perth is feeling the price shock brought on by a surplus of newly constructed apartment buildings that exceeded buyer demand. Coupled with steep annual falls in house prices, the capital is a long way away from returning to a healthy market,” said Domain Chief Economist, Dr Andrew Wilson.
Median house prices in Hobart increased to $345,880, a marginal growth of 0.3 per cent over the quarter. While Hobart is still clearly the most affordable capital city for buyers, it has noteworthy annual growth, with prices increasing by 2.6 per cent over the past year.
In contrast to most of the nation, Hobart median unit prices increased by a robust 2.5 per cent over the quarter, to $276,312. Unit prices in the capital city have grown by a staggering 10.4 per cent over the past year.
“While prices remain low in Hobart, especially in comparison to a market like Sydney, the capital has had impressive annual growth and continues to thrive. With lower interest rates stimulating investor activity, it’s likely we’ll see prices continue to climb,“ said Domain Chief Economist, Dr Andrew Wilson.
The median house price in Canberra increased to a record $654,306, over the June quarter, a 3.1 per cent rise and the strongest growth of all the capital cities. Canberra is second only to Melbourne for annual growth, with house prices rising 4.8 per cent over the past year.
Canberra median unit prices fell 1.6 per cent to $399,505, decreasing 4.4 per cent over the past year. Canberra unit prices are now at their lowest since December 2009 as high levels of apartment construction push supply ahead of demand.
“Canberra was the top market performer this quarter, surpassing the rest of the nation’s capitals with a strong growth in house prices. As market conditions continue to strengthen, it’s likely that Canberra prices will remain on the rise,“ said Domain Chief Economist, Dr Andrew Wilson.
Darwin’s median house price fell for the fourth consecutive quarter, dropping by 0.7 per cent to $613,590. Darwin median house prices have fallen by 7.7 per cent over the past year, the weakest result for the capital since December 2011, and the sharpest decrease out of all the capital cities.
Median unit prices in Darwin have steadied, with no change over the June quarter and a marginal decrease of 1.5 per cent over the past year.
“Darwin prices have continued to decrease as demand from resource industry workers dwindles in line with the downturn of the mining economy. We have yet to see an impact from the new supply of apartment buildings on the market and, for now, unit prices are steady,” said Domain Chief Economist, Dr Andrew Wilson.