Sydney home values climbed to a record in June as strong demand and low supply overshadowed increasing pain from high borrowing costs. Melbourne declined for a third straight month.
Bellwether Sydney rose 0.5 per cent in the month, taking the median price of a home there to a fresh high of A$1.17 million (S$1.06 million), property consultancy CoreLogic said on July 1.
Perth was the best performing capital, with prices gaining 2 per cent, while those in Brisbane jumped 1.2 per cent. Melbourne and Hobart were the only two of Australia’s eight capital cities to post declines. Overall, dwelling values for major cities climbed 0.7 per cent in June.
CoreLogic’s national index has advanced 36.8 per cent since the onset of Covid-19, despite the Reserve Bank of Australia’s (RBA) aggressive rate hikes, with Sydney climbing 28.2 per cent during that period.
“The persistent growth comes despite an array of downside risks including high rates, cost-of-living pressures, affordability challenges and tight credit policy,” said Mr Tim Lawless, research director at CoreLogic. “The housing market resilience comes back to tight supply levels, which are keeping upwards pressure on values.”
Higher interest rates, a shortage of homes and booming population growth have caused a housing crisis in large parts of Australia. The problem is particularly acute in Sydney, where buyers are being priced out of the market given an average home costs 13-times income.
