Australian house prices are showing no signs of slowing down, with prices up again for the month of May.
Figures from CoreLogic show that prices were up by 2.2 per cent last month, up from the 1.8 per cent increase that was seen in April, although not quite as high as the 2.8 per cent surge that was experienced in March (which also happened to hit a 32 year record).
Sydney continued to see strong growth, with a 3 per cent increase in prices in May, making for a total lift in prices of 9.3 per cent for the past three months.
But it’s not just Sydney that has been seeing solid results, with prices up for both houses and units for much of the country.
In fact, CoreLogic has found that around 97 per cent of local government areas in Australia have seen price increases over the past 3 months, which is a rarity considering the nation’s property diversity.
Why has property kept booming?
CoreLogic’s research director, Tim Lawless, has noted that the same fundamentals that have been driving growth in the property market still remain in place.
“The combination of improving economic conditions and low interest rates is continuing to support consumer confidence which, in turn, has created persistently strong demand for housing,” Lawless said.
“At the same time, advertised supply remains well below average. This imbalance between demand and supply is continuing to create urgency amongst buyers, contributing to the upwards pressure on housing prices.”
However, while some things in the property market have remained the same these past few months, some of the underlying trends have changed.
In particular, it is now the most expensive properties in the market that are seeing the highest growth across most of the capital cities, whereas early in the growth cycle it was more affordable properties driving the market.
It was also the smaller capital cities that helped lead the country into recovery after the shock of COVID, however Sydney has returned to the top of the ranks, seeing the largest capital gains over the last quarter.