Aussie property values soar in March with biggest gain in 33 years

CoreLogic’s dwelling value results have been released with Australia’s five major capital city markets soaring by 2.8% over the month – the biggest gain since Australia’s bicentenary in October 1988.

Australian property values

Australia’s five major capitals experienced their strongest price growth in 33 years.

The boom in values was broad-based with all major markets experiencing strong rises. However, Sydney’s gain was by far the strongest at 3.68% – the biggest monthly rise since August 1988:

Australian property prices by state

All major capital city markets recorded strong growth in March 2021.

Quarterly value growth at the 5-city level is now running above 5%, with Sydney (6.7%), Melbourne (4.9%), Brisbane (5.3%) and Perth (5.0%) all experiencing rapid appreciation. If this pace was to continue throughout the year, then dwelling values across the five major markets would rise by well over 20% in 2021.

Dwelling values across Sydney, Melbourne, Brisbane and Perth are each rising at around 20% annualised pace or above.

The next chart plots quarterly price growth across the five major markets over time. As you can see, the pace of growth has breached the peaks of previous price cycles:

Quarterly growth in Australian dwelling values

Dwelling value growth has topped the peaks of prior price cycles.

Annual growth is obviously slower owing to the COVID-19 downturn last year. However, it has also begun to accelerate across all major markets:

Annual Australian property price growth

Annual dwelling value growth is rebounding from the COVID-19 downturn.

The rebound in Australian property values is nothing short of extraordinary with 2021 shaping up to be one of the strongest years for property growth in the nation’s history.

Unconventional Economist
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Comments

    • “More than three-quarters of lenders listed on the Canstar database now have mortgages that allow lending to those with deposits of just 5 per cent.” Here we go again.

  1. my toranaMEMBER

    well the cheap credit theory wins. this is so ridiculous given our population is barely growing. apparently the ACT’s population dropped but rental vacancies and listings are as squeezed as ever.

    • Professor DemographyMEMBER

      Given the population reprieve is so far quite recent and short lived it is hard to say for sure just yet. We also have small numbers of listing at least until recently, and we may have many marginal buyers returning from overseas. The population part of the equation might not get long enough to make a dent.

  2. rob barrattMEMBER

    Excellent
    Nice to see potential debt levels roaring up again. In Aus, Debt = Wealth…

  3. Does this mean Josh & the LNPs covid support package & budget was massively misdirected & flawed? Asking for a Liberal member.

  4. Can someone ELI5 this for me. Assuming the pent up demand is coming from people that all of a sudden had an extra 20k available (40k for couples), how does this have such a large impact on the rental market considering the supply/demand equation doesn’t change? Also, with the population going backwards for the first time since World War 1 I’m scratching my head as to where all of this demand is coming from?

    • Apparently pent up… repressed FHBers and the like.

      Seriously though, search me, I can’t see how either, but I can see some monumentally stupidly insane prices payed for submersible plots of land…

  5. David WilsonMEMBER

    Reality will soon set in and see the bubble burst it’s just so unfortunate and unfair that these price hikes preclude our younger generation from getting a foothold in the property market leaving them exposed to ever increasing rentals for the rest of their lives.