Market still bubbling as spring sales season kicks off

For the 19th consecutive month, Australian property prices recorded value growth despite continuing high interest rates and an economy showing slightly higher unemployment and weakening fundamentals.
 

Leading industry researcher CoreLogic said values were up a further 0.5% month-on-month in August, delivering a rolling 12-week growth rate of 1.7%.
 

The market has been unable to sustain the pace of growth 12 months ago, when it achieved a 2.7% rise in values for the corresponding period in 2023.
 

Although the spring sales season usually increases the number of houses for sale by 18.2%, CoreLogic says there remains more buyers than available properties.
 

The dynamics of supply and demand vary significantly across the country. 
 

For example, Perth has almost 40% fewer properties on the market than its five-year average, while Melbourne has 25% more than its average.

Consequently, those cities with a tight supply saw values rise fastest in the latest data – Perth (+2% for the 12-week period), Adelaide (+1.4%) and Brisbane (+1.1%). The other capital cities were flat, either rising or dipping by less than 1%.
 

The median dwelling value in Melbourne ($776,044) has been overtaken by Adelaide ($790,800) and Perth (785,250). 
 

It's the first time since 2015 that Perth has had more expensive property than Melbourne.
 

However, this statistic is influenced by the fact that Melbourne has far more apartments than Adelaide or Perth. Houses are still more expensive in Melbourne. 
 

Here are CoreLogic's key market observations:

• The national housing market should continue to see modest value increases through 2024. Values are underpinned by a longer-term lack of new supply.
• Supply is being hampered by constraints in the residential construction sector. 
• The combined value of residential real estate rose to $10.9 trillion at the end of July.
• National home values increased by 1.7% over the rolling quarter, down from a cyclical high of 3.3% recorded through the June quarter of 2023.
• Record dwelling value records are current in Sydney, Brisbane, Adelaide and Perth. 
• Annual transaction volumes appear to have moved past their peak with 511,211 sales in the 12 months to July, down from 513,014 over the year to June. 
• Days-on-market has increased to 33 days in the three months to July, up from a low of 27 days in the three months to April. Longer selling times in Sydney, Melbourne and Hobart are driving the increase.
• Spring sellers should be aware of differences market-to-market. Heading into the spring selling season, there is no guarantee that buyer numbers will rise to meet the seasonal uplift in listings.