Australian homes are selling faster than ever as the property market enters a very active winter season. Strong buyer demand is keeping the market warm and cozy, while high sales volumes point to a continuation of the price growth we have been seeing in the housing market lately.
In fact, according to CoreLogic, the median time it takes to sell a house in Australia has fallen to a record low of just 29 days, down from 42 days in the same period last year.
So, why is the Australian housing market still so unseasonably hot?
In our latest update, we cover: • The continued growth of Australian house prices • What The Australian median house price is across the states • The return of the investors • Why Australian homes are flying off the (market) shelves
House prices continue to climb
According to the latest Hedonic Home Value Index released by CoreLogic, in the three months to May, national home values rose 7.0%, which is the highest quarterly growth rate since November 1988. Housing markets around Australia continued to surge to finish up 2.2% over the month, with almost every capital city recording an increase of more than 1% over the month.
Of the 334 SA3 subregions analysed by CoreLogic, 97% have recorded a lift in housing values over the past three months. Such a synchronised upswing is an absolute rarity across Australia’s diverse array of housing markets.” said CoreLogic’s research director, Tim Lawless.
Change in dwelling values
Mr Lawless reaffirmed the fundamentals driving strength in the housing market remain in place.
The combination of improving economic conditions and low interest rates is continuing to support consumer confidence which, in turn has created persistently strong demand for housing. At the same time, advertised supply remains well below average. This imbalance between demand and supply is continuing to create urgency amongst buyers, contributing to the upwards pressure on housing prices.
What is the median price of Australian homes?
What's the price of a house in Sydney?
What's the price of a house in Melbourne?
What's the price of a house in Brisbane?
What's the price of a house in Canberra?
What's the price of a house in Adelaide?
Investors return to strong market conditions
Post-Covid, we saw an unprecedented level of government stimuli (initiatives such as HomeBuilder and the First Home Loan Deposit Scheme) drive a surge in first-home buyer activity, and for the first time in more than a decade, lending volume to first-home buyers exceeded investors. According to ABS data, the value of new loan commitments to investors jumped 14.3% over March 2021, which was the highest monthly increase in loans to investors since 2003.
But a change has been taking place since February, with the trend flipped as investors return to the market. REA Insights reports that enquiries from investors has steadily recovered surging 98% higher in May compared to the trough in April last year.
So what’s driving them back? Record low interest rates, high household savings and government support has driven rapid price growth across most of Australia, and with the Big Four banks and countless experts forecasting the continued national price growth over this year, the conditions are ripe for investors to return to take advantage of the cheap cost of debt amidst improving economic confidence.
Why Australian homes are flying off the (market) shelves
Low volume of available stock remains a major hurdle for affordability in the Australian housing market. Fresh listings added to the housing market have picked up over recent months, with the number of new listings tracking 15% above the five year average.
CoreLogic estimates sales activity in the three months to May to be tracking about 37% higher than the five year average. House sales activity is outpacing the number of new listings added to the market, and the total number of homes for sales remains 24% below the five-year average.
“The sales to new listings ratio remains around 1.1, meaning for every new listing there is more than one sale occurring,” said Mr Lawless.
This rapid rate of absorption is keeping advertised inventory levels extremely low, despite the rise in new listings. As a consequence, vendors remain in a strong selling position”
It's still a seller's market out there - but there have been early signs that the exuberance may be reaching a peak. If you’re thinking of selling this year, time is of the essence! Right now is the window of opportunity while total listings still remain lower than average (meaning less competition) to capitalise on the strong buyer surge in this seller’s market.
Find out what your property could be worth in this current market today by booking a no-obligation, free property appraisal with your local Upside agent to see how your local suburb market has been performing, and where your property sits in comparison. As part of the process, we also supply a detailed market report of properties that have sold in your immediate area in the last 3-6 months.