House prices continue to climb ahead of the election
More than $2,700 added to home values during April, though market activity slowed because of the long weekends.
NEW data recorded a third straight month of house price growth in April, with prices up 0.3% to a new record high.
That has added approximately $2,720 to the median value of an Australian dwelling over the month.
The growth campaign despite the long weekends over Easter and Anzac Day, which resulted in a transaction traffic jam as the feelgood factor from the February rate cut subsided.
“The rate cut in February supported an upwards inflection in housing market conditions, but the positive influence from lower rates seems to be losing some potency,” Cotality (formerly CoreLogic) research director Tim Lawless said.
“At the same time, household confidence slipped in April, with the US’s ‘Liberation Day’ tariff announcements and the upcoming federal election causing uncertainty.
“It is likely this may be causing some buyers and sellers to delay their decisions.
“With further rate cuts likely as soon as May 20th, and a level of certainty returning to the market after the federal election, we expect a further modest rise in values for 2025.”
Although housing values are recording a broad-based rise, not every market is back to new record highs.
Only the mid-sized capitals where home values are at their highest level on record.
Sydney values remain -1.1 per cent below their September 2024 high. Melbourne values are down – 5.4 per cent from the record peak in 2022. Hobart is down -11.1 per cent, while in Darwin and ACT values remain -2.7 per cent and -6.4 per cent below their all-time highs.
“Given the softer trajectory of growth through last year, it’s likely the annual pace of gains will continue to soften over the coming months, despite the positive inflection in values since February,” Mr Lawless said.
Despite stretched housing affordability, growth in house values is continuing to outpace the unit sector.
The past three months have seen the value of houses rise by 1.1 per cent across the combined capitals, more than double the 0.5 per cent lift recorded across the unit sector. This trend is mostly being driven by Sydney, where house values were up 1.4 per cent over the rolling quarter compared with a -0.3 per cent fall in unit values over the same period.
Regional housing values have continued to outpace the capitals, with values up 0.6 per cent and 0.2 per cent respectively over the month of April.
This trend of regional home values rising at a faster pace than the capitals was a clear feature of the market through the pandemic but has once again become a theme in the monthly growth trends since October last year.
