The CoreLogic Home Value Index results for October out today confirm a 1.2% rise in national dwelling values over the month, delivering the fourth straight month of rising values. The October result was the largest month-on-month gain in the national index since May 2015. The recent gains come after a broad-based decline in housing values, with the national index declining 8.4% between October 2017 and June 2019. The positive October result takes national dwelling values 2.9% off their June 2019 floor, however values remain 5.7% below their peak, highlighting that despite the recent gains, home values are at a similar level to where they were three years ago.
The strongest growth conditions continue to be centered in Melbourne and Sydney, however dwelling values trended higher across most of the capital cities as lower mortgage rates and improved credit availability spurred on buyer demand.
The recovery trend in Melbourne overtook Sydney in October, with dwelling values surging 2.3% higher over the month; the largest month-on-month gain since November 2009. Melbourne housing values have recovered 6.0% since moving through a trough in May 2019, while Sydney values are up 5.3% since the recent May low.
The smaller capitals have delivered a mixed performance, although the general theme is one of improving conditions. The rolling three-month change in Brisbane housing values (+1.1%) was the highest since December 2015, Adelaide (+0.1%) posted the strongest rolling quarter since December 2018, while Hobart (+1.0%) and Canberra (+2.4%) recorded the largest three month rise in values since March 2019 and May 2017.
Mr Lawless said, "Focusing on housing market conditions across the broad value-based cohorts highlights that the market recovery is being led by the most expensive quarter of the market, although values are also rising across the more affordable strata as well, just not as rapidly."
Across the combined capital cities, values within the top quartile were up 5.3% over the three months ending October 2019, while the broad middle of the market was up 2.6% and the lower quartile was up 0.7%. Mr Lawless said, "These 'macro' figures are influenced by stronger housing market conditions in Sydney and Melbourne where housing values are inherently higher, however the trends are reflected at a sub-regional level as well."
Over the three months ending October 2019, the fastest appreciation in capital city home values has been across the top quartile of Melbourne and Sydney where values were 7.1% and 5.9% higher.
Over a shorter time frame, over the three months ending October 2019, the best performing regional market has once again been Launceston (+3.1%), followed by Illawarra (+3.0%), Mackay-IsaacWhitsunday (+2.5%), Gold Coast (+1.9%) and Cairns (+1.8%).
Mr Lawless said, "It's becoming increasingly clear that the housing market rebound is gathering pace, both geographically and across the broad valuation cohorts, off the back of lower mortgage rates and improved access to credit, as well as an improvement in affordability relative to the market peak several years ago and consistently high demand via population growth."
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