This set to happen in a couple of months
Australia’s property market is on track to a complete recovery by the end of 2023, with house prices just $2,000 short of a new milestone and unit prices trailing by $5,000, Domain has reported.
Domain’s latest House Price Report for the September quarter showed that houses and units experienced growth for the third and second consecutive quarters, respectively, with a 1.9% increase for houses and a 1.8% increase for units over the quarter.
While the quarterly growth rate has eased by a third compared to the previous quarter, house prices have risen on an annual basis for the first time in a year, and unit prices have been on the rise since mid-2022.
“September’s quarter confirms all Australian capital cities are in recovery or at a price peak,” Nicola Powell (pictured above), Domain’s chief of research and economics, said in a media release.
Sydney is still leading the way in the recovery, with Brisbane not far behind. By the end of the calendar year, house prices in Sydney and Brisbane are expected to have fully bounced back from the 2022 downturn, setting new all-time highs.
Adelaide, Perth, and Sydney led the pack in terms of house price gains for the September quarter. When it comes to units, Adelaide, Perth, and Melbourne recorded the most substantial quarterly increases. Adelaide and Perth hit record-high prices for houses, while Adelaide and Brisbane did the same for units.
“These record-high numbers are driven by a series of factors: interstate migration, record levels of overseas migration, a tight rental market, and a chronic undersupply,” Powell said.
“It is worth pointing out that the pace of growth is currently being somewhat contained by the stretched affordability. If mortgage rates weren’t as high as they currently are (5.98% for a new owner-occupied home loan), price growth would be faster with the current housing undersupply.”
That said, Powell reminded potential buyers about the importance of analysing the benefits and drawbacks of delaying their purchase timing along with financial planning.
“During the last quarter, choice has also risen for buyers, as sellers regain market confidence and pent-up supply makes its mark,” Powell said.
In September, auction volumes reached a 16-month high, and the national supply is now 5.1% above July’s low (6.5% higher in the combined capitals). New listings in Sydney, Melbourne, Canberra, and Hobart have risen annually.
“For sellers, with the market recovers, it is about pricing the home correctly ahead of the increasing competition,” Powell said.
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