Here's what Australian property prices look like in every capital city as interest rates rise

Here’s what Australian property prices look like in every capital city as interest rates rise

Australia’s average home value has fallen 2 percent to $747,800 since early May – a figure that includes houses and apartments, the latest housing data shows.

CoreLogic Research Director Tim Lawless says housing market conditions in Australia are likely to deteriorate as interest rates ticked higher later in the year.

Here’s a state-by-state breakdown of Australia’s latest housing figures.

Sydney: Home prices have fallen

Average changes: 2.2 percent decline in July

Sydney median house value: $1,346,193

Average unit value: $806,310

Five of the eight capitals posted monthly declines in July, led by Sydney home values ​​which fell 2.2 per cent.

“Although the housing market has only been declining for three months, the National Home Value Index shows the rate of decline is comparable to the onset of the Global Financial Crisis (GFC) in 2008 and the sharp downturn in the early 1980s,” Mr Lawless said.

“In Sydney, where the downturn has been particularly accelerated, we are seeing the sharpest falls in value in almost 40 years.”

The port city still has an average home price of $1.35 million and median unit price of $806,300.

Adelaide: house prices rise

Exchange: 0.4 percent increase in July

Adelaide mEdian house value: $705,634

Average unit value: $431,409

Corelogic data shows that housing in Adelaide has grown by 24.1 percent annually.

Brisbane: House prices have fallen

Exchange: 0.8 percent decline in July

BrisbaneEdian house value: $884,336

Average unit value: $504,520

Brisbane interfered negative again for the first time since August 2020.

According to Lawless, the trend of rising rents can be seen in every major city, led by Brisbane with a 4.2 per cent increase in rents in the three months to July.

“Rental markets are extremely tight, with vacancy rates of around 1 percent or less in many parts of Australia,” he said.

Canberra: house prices have fallen

Exchange: 1.1 percent decline in July

Canberra mEdian house value: $1,047,912

Average unit value: $626,128

Canberra’s average home value is $1.05 million.

Mr Lawless said so Standard values ​​in the combined capitals are in general Recording minor falls compared to home values.

“This trend is most evident in the three largest capital cities, as well as Canberra, where housing affordability challenges may drive more demand into the medium- to high-density sector,” Mr Lawless said.

“Such widespread and rapid rental growth is likely to remain one of the key domestic factors driving inflation, along with construction, food, transportation and energy costs.

“While some of this is due to global supply chain issues, the occupancy situation is domestic, caused by a combination of tight supply and increased demand,” Lawless said.

Darwin: Real estate prices have gone up

Average changes: 0.5 percent increase

darwin mEdian house value: $589,748

Average unit value: $374,340

The RBA decided to raise interest rates for the fourth straight month, raising the policy rate to 1.85 percent.(abc news)

Hobart: House prices have fallen

Exchange: 1.5 percent decline

HobartEdian house value: $782,748

Average unit value: $577,307

Corelogic data shows that Hobart’s home values ​​rose 10.1 percent over the year to July.

Melbourne: Home prices have fallen

Exchange: 1.5 percent decline

Melbourne mEdian house value: $964,950

Average unit value: $614,351

Melbourne house prices have now fallen for five straight months, with prices posting a 1.5 per cent drop in July.

Data shows that major regional centers of Geelong and Ballarat also saw home values ​​fall in the three months to July.

Perth: Home prices up slightly

Exchange: 0.2 percent increase

perthEdian house value: $587,024

Average unit value: $411,460

Looking at annual numbers, Perth housing has grown by 5.5 percent.

Mr Lawless says property markets in Perth, Adelaide and Darwin have seen a sharp slowdown in capital gains since the first rate hike in May.

A table shows that Australia's median house price fell 1.3 percent to $747,812 in July 2022.
House prices in Sydney, Melbourne and Hobart fell sharply in July.(CoreLogic)

How will rate hikes change things?

The RBA has raised interest rates by 1.75 percentage points to 1.85 percent since its first rate hike in May.

Just as interest rates being cut to record lows was the main reason for the price boom that emerged from the pandemic lockdowns, AMP Capital’s chief economist Shane Oliver says the current rise in interest rates will be the main reason for the housing market going forward.

“The ability to borrow at a fixed rate of 2 percent or less has been a key driver of the price boom, with fixed-rate borrowing accounting for 40 to 50 percent of new borrowing about a year ago,” he said.

“But with fixed mortgage rates now nearly tripled from their lows and adjustable rates rising rapidly, this has significantly reduced the amount new homebuyers can borrow and thus their ability to pay.

“This pulled the rug out from under the real estate market.”

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Home prices in Australia are falling at the “fastest rate” since 2008(Emilia Terzon)

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