Fastest Annual House Price Growth Since 1989
Australia has experienced phenomenal annual house price increases this year that according to Tim Lawless, Research Director at CoreLogic, is the fastest pass of growth since 1989. National housing prices in Australia back in the late 80s rose as much as 31%. Although what we are experiencing now isn’t necessarily unprecedented, we are seeing the current rate of growth is outpacing the average annual rate of growth by 3.6%.
Nationally, the housing values as reported at the end of August 2021 are up 15.8% and over the last year, we’ve experienced an 18.4% increase. Compare this to the average annual wage increase of 1.7% property increases are about 11 times that. It’s got to make one wonder how long it can sustain this speed! The average dwelling price has increased just a smidge over $100,000 on this time last year. The housing market is now valued at $6 trillion.
In Australia, the national median house price is just about to crack the $1 million mark. This year’s annual increases have the national median house price sitting at $955,927. As far as global housing affordability is concerned, Australia is one of the least affordable countries to live in. Sydney, Melbourne, Brisbane, and Adelaide are in the top 10 list of most expensive cities to live in!
Canberra has recorded the largest climb in housing prices this past year of 29.2%, taking the median price to $1.015 million. Compared to the median house values in Sydney sitting now at $1,293,450, Melbourne’s new median of $954,496, and in Brisbane the new norm is $691,214.
Brisbane has seen the strongest annual increase in property prices in 13 years, with an annual increase of close to 15%. However, like most capital cities it appears that the surrounding regional areas are having the biggest price hikes, with the Sunshine Coast reporting an annual increase of 25%, and in various locations much above that.
Will these growth conditions continue? Locally, yes, for the next several months, I feel we will see a continuing increase in buyer demand from our southern states, which will push prices up further. However, the pandemic has seen the housing markets contract hard across the globe, and therefore it could be expected to see an impact here over the next 12 months. The outlook for the near future remains positive.