Units Will Outperform Houses
Unit price growth is tipped to outperform house price growth as demand for more affordable housing drives more buyers to the unit market.
CoreLogic research director Tim Lawless says it's logical to expect more demand will start to focus on the unit sector.
Analysis of unit price growth shows values are up by 120% in Melbourne, 115% in Sydney and 81% in Brisbane over the past 20 years.
Lawless says undersupply is likely to push up unit prices further in the coming years.
He says previously an oversupply of units meant the asset did not grow substantially in value for some time.
He believes unit price growth in the East Coast capitals will continue and that Sydney’s unit markets will be the outperformers over the next decade as housing affordability worsens and the number of new units approved falls further.
“Approved unit supply over the 12 months to November last year was tracking 26.4% below the decade average, suggesting the unit sector is likely to be undersupplied, at least over the medium term,” he says.
