Australia’s national home prices reached a new high in March, driven by a surge in buyer demand following February’s interest rate cut, according to reports.
CoreLogic’s national index recorded a 0.4% rise in property values over the month, marking the second consecutive month of growth following a brief three-month decline. This uptick in March follows a modest 0.5% dip in values earlier this year.
PropTrack’s price index echoed similar trends, with property prices rising across all capital cities. Canberra saw the largest increase, up by 0.54%, followed by Sydney at 0.47%. However, the biggest annual price growth was seen in Adelaide, where values rose by 11.32%, and Perth, which recorded an 11.53% increase. Melbourne was the only capital city to experience a decline, with prices dropping by 2.26% compared to the previous year.
According to the report, national home prices have surged 48% over the last five years. In the past 25 years, the price of a typical home has more than doubled the median income, rising from four times to more than eight times the median. This shift has significantly impacted homeownership rates, particularly among younger Australians.
Buyer’s agents have warned that the recent price increases are bad news for first-time buyers and renters, many of whom are already struggling with the rising cost of housing. Renters, in particular, are often spending more on accommodation than those who have mortgages, making it harder to enter the property market.
Property experts described the recent price turnaround as “pretty mild,” noting that it was largely driven by changes in consumer sentiment following the rate cut. While the 0.4% national increase may not seem dramatic, they noted it signals a shift in market confidence, even though it may not result in substantial improvements in borrowing capacity or serviceability.
According to the experts, there was a rise in demand at auctions and a quicker pace of property sales. Since the beginning of the year, the market had opened up earlier than usual, with increased interest from first-time buyers and upsizers, they suggested.
The continuing rise in home prices, fuelled by changes in consumer confidence and ongoing financial support schemes, suggests that Australia’s property market remains dynamic, but it may still pose significant barriers to those trying to get a foothold.
