National home prices surged to a new high in October as the spring selling season was in full swing, PropTrack’s latest findings showed.
According to the PropTrack Home Price Index, national home prices reached their highest levels, surging by 0.36% month-on-month and posting a year-to-date increase of 4.93% in October, with price gains observed in all capital city markets except for Darwin.
“Although the volume of new listings hitting the market has risen over the spring selling season, the demand for housing has remained strong, fuelling further home price growth and reflecting the sustained improvement in conditions,” PropTrack senior economist Eleanor Creagh (pictured above) said in a media release.
Sydney’s property prices have rebounded from the 2022 declines and are now 0.32% higher than their previous peak in February 2022. Prices climbed 0.37% to a new record high in October and were now up 7.62% so far this year, and 7.71% higher than their trough in November 2022.
Property prices increased in all capital cities last month, except for Darwin. The smaller capital city markets experienced a more robust growth rate in October, with Brisbane and Perth leading the way, both recording a 0.52% increase in prices.
Meanwhile, property prices in the combined capital cities hit a new record high, outperforming regional markets for the year. However, the pace of growth in regional markets has picked up after trailing behind for most of the year. Regional property prices increased by 0.32% over the month, also reaching a record high, while capital city prices rose by 0.37%.
Regional Queensland and regional Western Australia were the top performers in October, with property prices increasing 0.61% and 0.45%, respectively, setting new record highs in both markets.
“Strong demand stemming from the rebound in net overseas migration, tight rental markets, and limited housing stock has offset the impacts of substantial rate rises and the slowing economy,” Creagh said.
“At the same time, dwelling approvals have declined, hitting decade lows earlier this year. The sharp rise in construction costs, compounded by costly delays arising from labour and materials shortages, has slowed the completion of new homes.”
Creagh noted that although the economic outlook appears weaker, population growth is showing a robust recovery and is expected to continue.
“Interest rates may rise further, but they are likely close to, if not at, their peak,” Creagh said. “Together with a shortage of new home builds and challenging conditions in the rental market, home prices are expected to rise further.”
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