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CoreLogic National housing market update [video] | March 2024 - featured image
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CoreLogic National housing market update [video] | March 2024

Housing values posted a broad-based rise in February, with CoreLogic's National Home Value Index up 0.6%.

National Housing Market Update | March 2024

This was a 20 basis point acceleration from the 0.4% increase seen in January and the strongest monthly gain since October last year.

Each of the capital cities and rest-of-state regions recorded a lift in values over the month, except Hobart, where the market was down 0.3%.

Housing values have been more than resilient in the face of high interest rates and cost of living pressures.

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The ongoing rise in values reflects a persistent imbalance between supply and demand, which varies in magnitude across the cities and regions.

Perth continues to stand out with a substantially higher rate of growth compared to any other region, up 1.8% in February, with Adelaide, Brisbane, and the regional areas of South Australia, Western Australia, and Queensland also showing a consistently high rate of capital growth month-to-month.

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These regions are generally benefiting from a combination of comparatively lower housing prices and positive demographic factors that continue to support housing demand.

Although growth rates in Sydney and Melbourne home values have levelled out, the monthly trend also recorded a pick-up.

Melbourne emerged from a three-month slump of negative monthly movements to record a subtle 0.1% rise in February.

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Similarly, Sydney dwelling values have moved back into positive territory over the past two months after recording a subtle decline in November and December.

Potentially, we're starting to see some early signs of a boost to housing confidence, as inflation eases and expectations for a rate cut, or cuts, later this year, firm up.

The re-acceleration and value growth have been accompanied by a bounce back in auction clearance rates and in consumer sentiment.

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Auction results and sentiment have both shown a historically strong relationship with housing trends.

The rise in clearance rates from the mid-50% range late last year to the high 60% range in February points to a better fit between buyer and seller pricing expectations.

A rise in sentiment suggests that households will have a better ability to make decisions around large financial commitments, like a property purchase.

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Although the pace of gains has shown some uplift, most regions are still recording value growth that's well below the highs of last year, when the national index rose 1.3% in May.

Last year's rate hikes clearly dented capital gains, but higher interest rates haven't been enough to extinguish growth entirely.

The shortfall of housing supply relative to housing demand is continuing to place upwards pressure on home values across most regions.

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Housing turnover is tracking higher than at the same time last year, but slightly below the previous five-year average.

Nationally, the estimated dwelling sales over the three months ending February were 4.7% above last year, with the capital cities a little stronger, tracking 6% higher than a year ago.

Relative to the previous five-year average for this time of the year, home sales are actually down 5% nationally and down 1.5% across the combined capitals.

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However, we could see the volume of home sales picking up later this year if sentiment continues to improve.

Growth in rental values has also re-accelerated through early 2024, with a monthly pace of change rising to 0.9% in February, the highest reading since March last year.

This re-acceleration also saw the rolling quarterly change in rents rise to 2.4%, the highest since May last year.

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The pickup in rents is mostly a seasonal phenomenon, with the first quarter of the year historically showing an accelerating trend.

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However, there's also been a pickup in the annual growth trend for rents, with the national rental index up from a recent low of 8.1% in October last year to 8.5% over the 12 months ending February.

ALSO READ:

Perth Housing Market Update [Video]

Adelaide Housing Market Update [Video]

Sydney Housing Market Update [Video]

Brisbane Housing Market Update [Video]

Melbourne Housing Market Update [Video]

About Tim heads up the Core Logic RP Data research and analytics team, analysing real estate markets, demographics and economic trends across Australia. Visit www.corelogic.com.au
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