Australia’s median home value hits $800,000 for first time despite surge in properties for sale | Latest Proptrack Report

Key takeaways

Proptrack reports that national home prices hit a new record in November, rising 0.15% over the month to sit 5.53% higher than a year ago.

Prices in the combined capital cities have increased 5.55% over the past year, after climbing 0.11% in November, but price performance remains varied across the country.

Hobart (+0.43%) and Adelaide (+0.40%) recorded the strongest growth in November of the capital cities, followed by Brisbane and Canberra (+0.28%).

Melbourne ranked as the fifth-most expensive capital in November, down from fourth place in October and third place earlier this year. Values in Adelaide have now surpassed Melbourne after Brisbane dwelling values surpassed Melbourne earlier this year.

Perth, Adelaide and Brisbane remain the strongest capital city markets for annual growth, with prices up 18.74%, 14.64% and 12.56% in the past year, respectively.

Annual price growth in the combined capitals (+5.55%) has just outpaced regional areas (+5.48%), but capital city buyers have been spoilt for choice with the surge in new listing volumes through spring. As a result, price growth has levelled out in the capitals, with regional areas leading in November. Prices in regional areas rose 0.26% over the month compared to 0.11% in the capitals.

Performance is also mixed in regional areas. Regional SA (+1.06%) and regional Tasmania (+0.65%) led growth in November, while momentum in regional Victoria remains subdued with prices down 2.09% over the past year following a 0.05% fall in November.

National home prices reached a new peak in November following 23 consecutive months of growth, however despite growth remaining positive, momentum has slowed, according to the latest PropTrack Home Price Index.

Ms Eleanor Creagh, Senior Economist at PropTrack explained:

"Although price growth has slowed, prices lifted 0.15% in November and the national median home value hit $800,000 for the first time.

While housing demand has remained defiant to persistent affordability constraints, we have seen the pace of home price growth slow since earlier in the year.

Although price growth has slowed, prices lifted 0.15% in November and the national median home value hit $800,000 for the first time.

While housing demand has remained defiant to persistent affordability constraints, we have seen the pace of home price growth slow since earlier in the year."

Australia’s median home value hits $800,000 for the first time despite surge in stock for sale

According to PropTrack's data, Australian home prices hit a new peak in November after 23 consecutive months of growth.

National home prices lifted 0.15% in November and are now 5.53% higher than a year ago.

Prices lifted in every capital city in November except Melbourne, though the pace of growth has slowed as buyers enjoy more choice.

Ms Creagh further explained:

"The increase in properties hitting the market in recent months has been met with strong demand, but is a contributor to slowing price growth along with affordability constraints and the sustained higher interest rate environment.

The pace of home price growth remained varied across the capitals in November, reflecting multi-speed market conditions, with differing supply and demand conditions continuing diverse performance across the country.

Prices in the combined capital cities have increased 5.55% over the past year, after climbing 0.11% in November."

Price growth has levelled out in the capitals, with regional areas leading in November

PropTrack's data show that annual price growth in the combined capitals (+5.55%) has just outpaced regional areas (+5.48%), but capital city buyers have been spoilt for choice with the surge in new listing volumes through spring.

As a result, price growth has levelled out in the capitals, with regional areas leading in November.

Prices in regional areas rose 0.26% over the month, more than 2 times the 0.11% lift in the combined capitals.

Performance is also mixed in regional areas. Regional SA (+1.06%) and regional Tasmania (+0.65%) led growth in November, and continue to record a fast pace of annual growth.

Meanwhile, momentum in regional Victoria remains subdued with prices down 2.09% over the past year following a 0.05% fall in November.

Ms Creagh further said:

"Differing supply and demand conditions are contributing with buyers in regional Victoria enjoying a lot more choice contributing to subdued price momentum.

Meanwhile Victoria’s unemployment rate has risen over the last year, and is now the highest in the country."

Outlook

Ms Creagh highlighted that while housing demand has remained resilient to persistent affordability constraints, we have seen the pace of home price growth slow since earlier in the year.

She further noted:

“This softening in growth has occurred alongside a surge in stock for sale, giving buyers more choice and reducing the urgency to transact.

However, performance has varied across markets with differing supply and demand conditions.

The increase in properties hitting the market this year has been met with strong demand, but increased stock
for sale has been a contributor to slowing price growth, along with affordability constraints and the sustained
higher interest rate environment.

In the period ahead, home prices are expected to lift, though the pace is expected to remain softer trailing the
strong growth in prices over recent years.”

About Brett Warren Brett Warren is National Director of Metropole Properties and uses his two decades of property investment experience to advise clients how to grow, protect and pass on their wealth through strategic property advice.