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Property values start 2022 on the up

The typical Australian home is now worth $131,236 more than it was a year ago with values climbing in January, albeit at a much slower rate than the astronomical surge witnessed in 2021.

CoreLogic’s Hedonic Home Value Index shows property values rose 1.1 per cent in the first month of 2022, a fraction higher than the 1 per cent climb recorded in December.

Five of the eight capital cities recorded a slight uptick in the monthly growth rate, including Melbourne, with 0.2 per cent growth, overturning a slight decline in December.

CoreLogic Research Director Tim Lawless said housing stock was thinly traded in January and it will be important to monitor the trend as the number of transactions increases.

“As the volume of home sales moves out of seasonal lows, we should get a firmer reading on how 2022 is shaping up,” he said.

“The early indication is that housing markets are starting 2022 with a similar trend to what we saw through late last year.

“Values are still broadly rising, but nowhere near as fast as they were in early 2021.

“A softening in growth conditions has been influenced by less government stimulus, worsening affordability, rising fixed term mortgage rates and, more recently, a slight tightening in credit conditions, and a surge in new listings through the final quarter of last year.”

Source: CoreLogic

The annual change in national housing values reached a new cyclical high in January with Australian dwellings up 22.4 per cent over the year, which is the highest rate of annual growth since June 1989.

The national median value for a dwelling is now $718,146 which, in dollar terms, is $131,236 higher than a year ago.

Three of the eight capital cities now have a median house value above $1 million with Melbourne passing that mark for the first time in January.

The median value of a house in Melbourne is now $1,002,464, following a 0.5 per cent rise in January, and 17.8 per cent annually.

That rate slowed to 0.2 per cent growth in January for all dwellings combined.

Sydney is still the most expensive city to buy a house in, with a median house value of $1,389,948, which was 0.8 per cent up for January.

Source: CoreLogic

A multi-speed dynamic has emerged across the capital cities with housing values in Brisbane and Adelaide continuing to grow at more than 2 per cent month-on-month, while growth conditions across the other capital cities has slowed.

Brisbane recorded the highest value growth in January, up 2.3 per cent for the month, closely followed by Adelaide (2.2 per cent), Canberra (1.7 per cent) and Hobart (1.2 per cent).

Sydney and Perth each recorded 0.6 per cent growth, while Darwin recorded 0.5 per cent for January.

Regional areas have again shown stronger growth for housing values, up 1.8 per cent in January and 6.3 per cent for the rolling quarter.

By comparison the combined capital cities recorded 0.8 per cent growth for the month and 2.6 per cent for the rolling quarter.

Regional Queensland and regional South Australia led the charge with 2 per cent and 2.1 per cent growth respectively. 

Every other broad ‘rest of state’ region recorded at least 1.2 per cent growth in values, which shows strong demand for regional housing. 

Over the past 12 months, the strongest regional markets have been popular as commutable markets with lifestyle characteristics, such as the Southern Highlands and Shoalhaven (up 37.6 per cent), the Sunshine Coast (up 34.4 per cent) and the Hunter Valley, excluding Newcastle, (up 34 per cent).

Houses are still growing at a higher rate than units, with national values up 1.3 per cent in January, while unit values rose just 0.3 per cent.

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