Houses Outstrip Units On Growth

Posted on 29/06/2017  
Houses Outstrip Units On Growth

Buyer demand for apartments is generally rising around Australia, for both affordability and lifestyle reasons, but houses continue to out-strip apartments on price growth.

Traditionally, houses have out-performed apartments (generally speaking) and the land content component is considered to be the key factor.

This paradigm may change as more and more Australians choose the apartment lifestyle, but currently there are big differences in growth when comparing house prices with apartments.

Over-supply in some inner-city apartment markets is a factor in this.

The latest figures from Louis Christopher’s SQM Research provide further evidence of the dominance of houses when it comes to price growth.

SQM’s index for asking prices shows that, in most of the capital cities, annual growth for houses is at least double that for apartments.

In the leading market Sydney, the annual growth in the Asking Price Index is currently 14.4% for houses and 5.5% for apartments. In Canberra, houses are up 13.3% but apartments only 3.9%.

In the cities where prices have been going backwards, the degree of decline is more pronounced for apartments.

In Perth, the index for houses is down 4.4% while units are 7.1% lower, while in Darwin houses are 3.8% lower while units are down 9.3%.

The exception to this general relationship between houses and apartments is Hobart. According to the SQM figures, the Asking Price Index is slightly higher for apartments, but Hotspotting believes the small size of the unit market in the Tasmanian capital may be creating some statistical distortions.

In terms of national averages, houses are up 9.2% and apartments 4.8%.

« Back