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Property values across Australia’s combined capital cities
increased by 3.8% over the second quarter of 2016 to take
them 5.5% higher over the first half of 2016 and 8.3% higher
over the 2015–16 financial year. This means the total value of all
residential dwellings in Australia has increased to $6.6 trillion.
Although the annual change in capital city home values remains
strong, it has slowed from a recent peak rate of growth of 11.1%
over the 12 months to July 2015.
Sydney and Melbourne continue to record a substantially higher
rate of growth in values compared to the remaining capital cities
with annual increases of 11.3% and 11.5% respectively. Most other
capital cities are recording value rises; however, only Hobart (+6.2%)
and Brisbane (+5.3%) have recorded annual value increases in
excess of 5%. Both Adelaide and Canberra have also seen values
rise over the year, up 2.2% and 3.9% respectively. Perth and Darwin
have continued to record declines in home values with falls of –4.7%
and –1.1%.
Rents however have fallen by –0.6% over the past year. CoreLogic
has been tracking rental rates since 1996 and these are the largest
declines recorded over that timeframe. With values rising and rents
falling, gross rental yields have slumped to historic low levels. Gross
rental yields across the combined capital cities have softened from
3.6% in June 2015 to 3.3% in June 2016.
The volume of newly advertised residential property for sale across
the capital cities is trending lower, with “new to market” property
listings now substantially lower than the same time last year. Brisbane
is the only capital city in which new listings are higher than they were
a year ago suggesting vendor confidence is improving. While there
is less newly advertised stock available for sale, the total volume of
stock advertised for sale (New listings plus re–listings) is higher than
a year ago. The only capital cities which currently have less stock for
sale than a year ago are Hobart and Canberra.
The annual rate of home value growth slowed a little in June and it
is anticipated the rate of home value appreciation will continue over
the second–half of 2016. Home values reached a low point in May
2012 and since that time combined capital city home values are 37%
higher with Sydney and Melbourne having recorded substantially
higher value increases than all other capital cities. Clearly this growth
can’t continue forever and with affordability stretched it is likely that
the rate of value growth will start to slow.
While the combined capital cities figure suggests the housing market
is recording strong growth, across each of the capital cities, housing
market conditions are very different. Capital gains are strong in
Sydney and Melbourne with much slower growth in most other cities,
while dwelling values are trending lower in Perth and Darwin. Sydney
and Melbourne continue to benefit for stronger economies which
is leading to greater job creation and ultimately superior population
growth. While overseas migration is slowing at a national level it is
actually picking–up in New South Wales and Victoria highlighting
strong economies with good job prospects will continue to attract
skilled migrants and drive housing demand.
Property prices
continue their rise
Note: ‘this year’ = May 2016, ‘last year’ = May 2015
Median price figures & growth figures are to June 30, 2016
All statistics are based on data from the CoreLogic Indices suite, as at July 2016
Adelaide
Darwin
Houses
Units
Median Price
$450,000
$345,000
Growth
2.2%
1.7%
Days on Market
51
this year
54
this year
51
last year
59
last year
Discounting
–6.0%
this year
–6.7%
this year
–5.7%
last year
–6.6%
last year
Houses
Units
Median Price
$575,000
$404,000
Growth
–0.1% –4.9%
Days on Market
78
this year
136
this year
81
last year
100
last year
Discounting
–8.1%
this year
–16.2%
this year
–6.7%
last year
–8.4%
last year
Perth
Houses
Units
Median Price
$521,400
$405,000
Growth
–4.6% –5.5%
Days on Market
69
this year
71
this year
55
last year
70
last year
Discounting
–7.6%
this year
–8.8%
this year
–6.6%
last year
–7.1%
last year
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