Key Points
- Home prices continued to rise despite cost of living pressures.
- Australian homes added about $12,000 in value in the first three months of the year.
- Housing values so far this year were rising faster than the pace of growth at the end of 2023.
Homes values have continued their march upwards despite rate hikes with the latest data revealed on Tuesday.
Australian homes added about $12,000 in value in the first three months of the year, despite the cost-of-living crunch and rate hikes, fresh data has revealed.
CoreLogic's latest data, released on Tuesday, shows that housing values so far this year were rising faster than the pace of growth that was occurring at the end of 2023.
However, that 1.6 per cent jump in the three months to March was half the 3.3 per cent quarter-on-quarter price rises that were occurring in the middle of 2023.
"Rate hikes, cost of living pressures and worsening housing affordability are all factors that have contributed to softer housing conditions since mid-last year," CoreLogic's research director Tim Lawless said.
"However, an undersupply of housing relative to demand continues to keep upwards pressure on home values despite these headwinds."
Every capital city apart from Darwin, where prices fell 0.2 per cent, experienced an increase in house values in March.
CoreLogic's home value index has increased $71,832 or 10.2 per cent since January 2023.
Regional housing markets are also booming, although Victoria stood out with a 0.3 per cent drop in home values.
Home sales across the country in the past three months were estimated to be 9.5 per cent higher in comparison to last year's first quarter.
On rents, unit prices continue to rise faster than leasing a house, but the analysis shows a gradual narrowing of the gap between house and unit rental growth trends.
"A rise in rental yields alongside an expectation that housing values could rise and rental markets remain tight for an extended period of time is likely to be seen as an attractive opportunity for property investors," Lawless said.
However, he warned that with mortgage rates averaging 6 per cent, investors new to the market could expect to make a loss on their rental unless they "stump up a sizeable deposit".
