- House prices continued to grow, outpacing unit price growth
- Unit segment remains robust as houses become unaffordable for many buyers
- Supply and demand mismatch to spur further price growth
Ray White’s June House Price Report has been released, revealing that home values continued their upwards march with no sign of stopping.
The newest house price data report from Neoval has found that Australian house and unit prices spiked once more in June.
The latest interest rate hike in June has potentially made vendors more apprehensive, according to Ray White Group head of research, Vanessa Rader, who said the ‘wait and see’ attitude resulted in limited listing numbers.
Nonetheless, the housing supply deficit is responsible for the price growth nationwide.
Houses continue to outperform units
The values of houses and units moved upwards, with houses pulling ahead of the pack.
First are Perth houses, enjoying a one per cent increase to a median price of $702,607.
Perth, Brisbane, Adelaide, and Darwin have surpassed peak values recorded in the previous year, with the other markets moving in the same direction, as the house prices of capital cities post a 0.8% rise in June.
National house prices are moving faster than units
Lower prices boost unit demand
Driven by concerns over affordability, average unit growth remained healthy in June, with the across capital cities values increasing by 0.6% to $571,700 — a 3.6% jump over the last 12 months.
Darwin experienced the most significant gain in June, up 1.1% to $390,730. On the other hand, Perth had a 0.8% uptick, while Adelaide rose by 0.6%.
Although markets on the East Coast have traditionally been susceptible to fluctuations in interest rates, which harms one’s borrowing power in a pricey market, Sydney and Melbourne produced positive monthly gains of $879,843 and $644,629, respectively.
Sydney’s house price growth has been exceptional over the past year, going up by 6% to $1,646,009, while Brisbane surged by 5.5% to $879,731, with both markets pulling ahead of Australia’s annual growth rate of 4.9%. Brisbane leads the pack in terms of units, up by 4.1% to $524,056, while Adelaide recorded a 4% gain, still above Australia’s growth rate of 3.6%.
Prices are likely to climb further
The protracted housing shortage affecting Australia underscores June’s stable value appreciation. As illustrated by monthly and yearly results, the upward price pressure results from a discrepancy in supply and demand as Australia’s population grows.
The inflated construction costs have prohibited supply from entering the market on time, which most likely will pressure prices for the rest of the year, moving nationwide house and unit values back to peak 2022 levels. Other recent reports generally agree with this view, with PropTrack predicting that prices will peak in January 2024.
