New data from two sources confirms that a national real estate boom is under way across Australia.
The latest figures from both Domain and CoreLogic record annual growth in house prices in most locations in the nation, but in particular in the latest quarter.
CoreLogic’s 1 February price report shows that all 15 market jurisdictions (eight capital cities and seven state regional precincts) recorded uplift in the month of January and in the three months to the end of January.
Domain’s price report published last week shows all eight capital cities had significant price increases in 2020, with particularly major uplift in the December Quarter.
The CoreLogic figures show quarterly growth of at least 2.4% in all 15 of the major market jurisdictions. That equates to double-digit increases over the coming year if those growth rates are maintained. But 12 of the 15 major markets had quarterly increases ranging from 3.5% to 7.8%.
The Domain data shows quarterly rises in house prices ranging from 3% to 6.4% in five of the eight capital cities and equally significant increases throughout many regional locations. The smaller capital cities and the regional markets are leading the growth in house prices.
In annual terms, according to CoreLogic, Darwin (15%), Canberra (9.5%), Hobart (8%) and Adelaide (7%) are all out-performing, while the regional markets of Tasmania, South Australia, NSW and Queensland have all increased by between 8% and 12.5%.
The growth is being fuelled by multiple factors, including …
- A stronger-than-expected economy
- Lower-than-predicted unemployment
- State and federal stimulus measures
- Ultra-low vacancies, putting upward pressures on rents and prices
- Low listings levels, relative to buyer demand
- The Exodus to Affordable Lifestyle trend
- Increasing spending on major new infrastructure
- The return of ex-pat Australians in large numbers
- The belated entry of investors to compete with owner-occupiers
- The safety and solidity of bricks and mortar in times of uncertainty
- Access to low-cost finance
And you’ll notice that I mention low interest rates as just one of a dozen different factors – and I mention it last and definitely least. That’s contrary to Australia’s gaggle of chattering economists who seem to think that low interest rates is the only factor causing prices to rise – which, frankly, shows how little the members of that over-rated profession really understand about real estate markets.