Australian house prices continue to ignore the Reserve Bank of Australia’s (RBA) aggressive monetary tightening, with values rising a strong 0.33% in the week ended 22 June, according to CoreLogic.
It was the 16th consecutive weekly rise in dwelling values at the 5-city aggregate level:
Price growth was universally strong with all five major capital city markets recording value increases:
Quarterly price growth continues to accelerate, with values rising 3.4% across the five major capitals.
Sydney continues to lead the way, recording a 4.9% increase in values over the quarter:
The next chart plots the price rebound from the market’s bottom on 7 February, with values rising by 4.1% at the 5-city aggregate level.
Sydney has recorded the strongest growth, with values surging 6.3% from their bottom; although each of the major markets have recorded rebounds:
After the RBA hiked the official cash rate another 0.25% earlier this month, Mark Bouris, Tom Panos and several other notable real estate players warned the housing market was approaching a ‘turning point’.
In particular, they warned of a wave of forced selling as hundreds of thousands of borrowers transition from cheap fixed rate mortgages of 2% to variable rates approaching 7%:
Clearly, we are yet to see a material impact from the RBA’s latest rate hike, with prices continuing to rise and auction clearance rates barely budging:
However, the situation could quickly change if the RBA lifts interest rates two more times in July and August, as forecast by Westpac, ANZ and NAB.
