Consumers contend with a more buyer-friendly market, the rising cost of living and continued rate rises
The Real Estate Institute of Australia’s latest Real Estate Market Facts report shows a mixed outlook for real estate as consumers contend with a more buyer-friendly market, the rising cost of living and the Reserve Bank’s aggressive interest rate hikes.
REIA president Hayden Groves said the report found that the weighted average capital city median house price had fallen by 8% over the past year.
“This was the largest annual decrease over the past 20 years,” Groves said. “In the eight capital cities, the median house price increased in Adelaide (1.5%), Perth (2.7%), Canberra (0.5%) and Hobart (4.1%) and declined in Sydney (-2.1%), Melbourne (-1.6%), Brisbane (-0.7%) and Darwin (-1.8%).”
The Australian weighted average median house price fell to $945,474, a decrease of 1% from the previous quarter, REIA reported.
The report also examined vacancy rates as the rental crisis continues across Australia.
“The vacancy rate in the December quarter increased in Sydney, Brisbane, Adelaide, Canberra and Darwin, remained stable in Perth, but decreased in Melbourne and Hobart,” Groves said. “The largest increase was in Darwin (0.8 percentage points).
Melbourne saw the largest decrease in vacancy rates at 0.8 percentage points. Adelaide had the tightest rental market, with a vacancy rate of just 0.5%.
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Groves said there was no relief in sight for renters, with prices continuing to rise thanks to the chronic housing shortage.
“In the December quarter, the median rent for three-bedroom houses increased in Melbourne, Brisbane, Adelaide, Perth and Darwin, remained stable in Sydney and decreased in Canberra and Hobart,” he said. “The largest increase was 5.3% in Perth.”
In the 12 months to the December quarter, the median rent increased in all capital cities, Groves said. Brisbane posted the sharpest increase at 21.4% – the highest annual increase so far this century.
“Meaningful action” needed
Groves said REIA’s Real Estate Market Facts report for the March quarter will also show continued pressures on the housing and rental market caused by short supply.
“We will be looking to state and federal governments for meaningful action on housing and reforms of systems [limiting] a rapid injection of rental supply,” he said. “We have had inadequate investment and planning reform in Australia for many years, and now it is time for true action.”
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