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The housing market\u2019s fastest upswing on record has been playing an \u201cintegral\u201d part in Australia\u2019s ongoing post-pandemic recovery.<\/p>\n
CoreLogic\u2019s latest Economic and Property Review said the $9.4tn housing sector has been boosting the current economic landscape, as house prices rise across regional areas and capital cities.<\/p>\n
National dwelling values rose by 22.2% in the year to November, with regional markets posting a superior growth of 25.2% than capital cities\u2019 21.3%.<\/p>\n
During the same period, 613,635 homes found new owners across the country, the highest annual sales volume since December 2003.<\/p>\n
CoreLogic head of research Eliza Owen said these recent housing indicators was the likely result of government support, low interest rates that lowered mortgage costs, and the limited supply that tightened buyer competition.<\/p>\n
\u201cHousing-related government support such as the First Home Loan Deposit and HomeBuilder schemes and non-housing fiscal stimulus, such as JobKeeper, helped many Australians service housing costs such as rents and mortgage repayments,\u201d she said.<\/p>\n
Institution-led support, particularly home loan deferrals, also helped struggling households, preventing distressed sales over the year.<\/p>\n
Meanwhile, the report also noted of the significant increase in Australia\u2019s household savings rate, which went to 23.6% through to June 2020, higher than the decade average of 6.9%.<\/p>\n
\u201cIt is probable that lower mortgage rates, and an observed economic and housing market recovery from the end of 2020, contributed to buoyant housing demand, particularly in those cities impacted by lockdowns in 2021,\u201d Ms Owen said.<\/p>\n
However, Ms Owen recognised that the momentum in the housing market is now slowing, particularly in Sydney and Melbourne.<\/p>\n
These two markets have witnessed surges in new listings, which are helping soothe the affordability constraints brought about by the boost in prices.<\/p>\n
\u201cAcross Melbourne, demand appears to be shifting to more affordable areas of the city, with lowervalue dwelling markets seeing a pick-up in quarterly growth rates,\u201d Ms Owen said.<\/p>\n
\u201cSimilarly, value gains are accelerating across regional NSW, while affordability weighs on dwelling demand across Sydney.\u201d<\/p>\n
Brisbane and Adelaide<\/a> are also witnessing growth rates hit new highs in more than a decade.<\/p>\n In the ACT, investor activity continues to rise as the concentration of housing demand has shifted to the unit sector.<\/p>\n Ms Owen believes that while the robust performance across markets over the past year is impressive given the pandemic, it will likely be unsustainable, especially on the back of likely restrictions in lending and impending hike in cash rate.<\/p>\n \u201cListings levels are normalising across Sydney and Melbourne, and affordability constraints are worsening across most housing markets,\u201d she said.<\/p>\n \u201cAs a result, it is expected that 2022 will see far milder rates of appreciation in Australian dwelling values.\u201d<\/p>\n \u2014<\/p>\n Photo by Hayden on Unsplash.<\/em><\/p>\n<\/p><\/div>\n
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