House prices have hit record highs – is this another property boom?

Australian median house prices have hit record highs new in every capital city bar Darwin and Perth.

According to Domain’s House Price Report for the December quarter latest median house price in Sydney now sits at $1.21 million.

Melbourne’s property prices have staged a massive comeback, rising 5.3 per cent in the last three months of 2020, and now they not only surpass pre-pandemic levels but have set new peak prices for both house and units.

Capital cities – median house prices

Capital cities Median QoQ YoY
Sydney $1,211,488 4.8% 6.7%
Melbourne $936,073 5.3% 3.9%
Brisbane $616,387 0.8% 5.6%
Adelaide $574,264 2.1% 6.1%
Canberra $855,530 6.4% 9.1%
Perth $563,214 3% 6.3%
Hobart $564,091 6.1% 12.4%
Darwin $533,845 2.3% 3.6%
National $852,940 4.1% 5.8%
Source: Domain House Price Report, December Quarter, 2020.  

The pieces to the property puzzle are falling into place and our property markets are on the move and will perform strongly in 2021.

Clearly our property market’s performance has been a far cry from all those Doomsday predictions of early last year.

Last October in my regular blogs on this site I announced that Australia’s property markets had turned the corner after being put on pause by the coronavirus induced lockdowns which caused “the recession we made us have.”

But now it’s official, the strong activity our team at Metropole saw on the ground last year has come through in the latest stats.

In fact, some commentators are even calling it a “Boom”, with property values rising as more Australians are looking for a new home or to upgrade their homes at a time when there are fewer properties on the market.

Melbourne unit median prices leapt by 4.4 per cent overall to a median of $569,677 — $14,000 higher than the record set in 2019, according to Domain’s House Price Report.

Capital cities – median unit prices

Capital cities Median QoQ YoY
Sydney $729,840 0.2% -0.3%
Melbourne $569,677 4.4% 2.5%
Brisbane $395,218 -1.1% -3%
Adelaide $350,122 0% 13.5%
Canberra $485,410 3% -1.3%
Perth $347,585 2.3% 4.4%
Hobart $432,552 1% 2.5%
Darwin $285,539 0.6% 7.5%
National $574,245 1.3% 0.9%
Source: Domain House Price Report, December Quarter, 2020.

The boost in property prices had obviously been helped by record low interest rates, government grants and incentives for home buyers, as well as increasing consumer confidence that we have this “virus thing” under control.

This increase in consumer confidence shows up in various surveys suggesting Australian’s now believe it is the best time in many decades to purchase Real Estate including the following from Finder.com.au:-

Finder

 

At the same time housing finance approvals have been rising strongly meaning that there are more buyers in the market at the moment at a time when there fewer listings, which saw more competition push prices higher.

Housing Finance

As always…price growth is not even

Remember there are markets within markets – each state has multiple markets based on geography, price point, and type of dwelling. Hawksburn Melbourne

A great example of this are the following 2 tables The following chart from Domain shows not all regions in Melbourne performed the same.

And of course even within the same regions some properties types of property will outperform others.

There is nothing new here, but it’s a good reminder that careful property selection is critical for investment success.

Melbourne regions – median house price

Region Median QoQ YoY
Inner $1,330,000 4.7% -0.7%
Inner East $1,472,000 3.7% -0.7%
Inner South $1,380,250 7.8% 1.7%
North East $752,500 6% 3.1%
North West $672,500 5.1% 4.3%
Outer East $822,250 9.5% 2.8%
South East $676,000 2.4% 2.4%
West $645,000 7.5% 5.7%
Mornington Peninsula $802,000 8.4% 14.6%
Source: Domain House Price Report, December Quarter, 2020.
Source: Domain

Melbourne regions – median unit price

Region Median QoQ YoY
Inner $576,000 4.5% -1%
Inner East $675,000 8.4% -1.7%
Inner South $660,000 7.8% 0%
North East $527,000 0.3% -3.3%
North West $480,000 3.2% -6.4%
Outer East $590,000 6.9% 0.9%
South East $497,750 -3.3% -1.2%
West $460,000 -3.2% 2.2%
Mornington Peninsula $507,500 2.5% 5.5%
Source: Domain House Price Report, December Quarter, 2020.

Now is the time to take action and set yourself up for the opportunities that will present themselves in property this year.

Metropole Team

If you’re wondering how to take advantage of the new property cycle you can trust the team at Metropole to provide you with direction, guidance and results.

Whether you are a beginner or a seasoned property investor, we would love to help you formulate an investment strategy or do a review of your existing portfolio, and help you take your property investment to the next level.

In “interesting” times like we are currently experiencing you need an advisor who takes a holistic approach to your wealth creation and that’s what you exactly what you get from the multi award winning team at Metropole.

If you’re looking at buying your next home or investment property here’s 4 ways we can help you:

  1. Strategic property advice. – Allow us to build a Strategic Property Plan for you and your family.  Planning is bringing the future into the present so you can do something about it now!  This will give you direction, results and more certainty. Click here to learn more
  2. Buyer’s agency – As Australia’s most trusted buyers’ agents we’ve been involved in over $3.5 Billion worth of transactions creating wealth for our clients and we can do the same for you. Our on the ground teams in Melbourne, Sydney and Brisbane bring you years of experience and perspective – that’s something money just can’t buy. We’ll help you find your next home or an investment grade property.  Click here to learn how we can help you.
  3. Wealth Advisory – We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you.
  4. Property Management – Our stress free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years and our properties lease 10 days faster than the market average.
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Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media. Visit Metropole.com.au


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