Suburbs of Australia’s largest cities have seen double-digit price increases over the past year, despite aggressive interest rate increases from the Reserve Bank.
A new CoreLogic report has revealed that prices rose in 82.4% of Australia’s 4,506 suburbs with homes and apartments in the three months to October.
The increase came before the Reserve Bank of Australia raised interest rates in November for the 13th time in 18 months, following a pause since July, taking the interest rate to a 12-year high of 4.35%.
With immigration levels at record highs, suburbs of Sydney, Melbourne, Brisbane, Adelaide and Perth have all seen double-digit price increases over the past year, with large increases also seen over the past three months.
CoreLogic’s head of research, Eliza Owen, said strong population growth meant house prices were rising “despite high interest rates and weakening economic conditions.”
“Migration trends, both international and interstate, are supporting greater demand for housing,” she said.
Suburbs of Australia’s largest cities have seen double-digit price increases over the past year despite aggressive interest rate increases from the Reserve Bank (pictured is a house in Thornleigh in Sydney’s north)
CoreLogic head of research Eliza Owen said strong population growth meant house prices were rising “despite high interest rates and weakening economic conditions” (pictured is a map of Sydney showing an area of suburbs with strong annual price growth) .
In Sydney’s north, house prices in Thornleigh rose 19.7% for the year and 3.3% for the quarter to $1.848 million.
In Strathfield’s west-central city, the median house price has increased 15.3 percent over the past year and 4.6 percent quarter-over-quarter to $3.627 million.
Nearby Five Dock on the Parramatta River saw an 8.4% increase in three months, taking its average price to $2.691 million.
These suburbs are well above Sydney’s median of $1.397 million, and it’s a city that receives a larger share of international migrants and international students.
But the big increases weren’t limited to affluent postcodes – house prices in Bankstown, in the city’s southwest, rose 15 per cent in a year and 3 per cent in three months to $1.341 million.
It was a similar story in Blacktown, in the city’s west, where prices rose 14.1 percent over the year and 2.7 percent over the quarter to $939,829.
In Melbourne’s Murrumbeena in the city’s southeast, house prices rose 12.4% in the middle of the year and 3.7% in three months to $1.722 million.
This was a much stronger result than Melbourne’s larger annual growth of 2.2%, which saw the average house price rise to $937,736.
In Brisbane, double-digit growth was much more common in a city where most of the population growth is driven by interstate rather than overseas migration.
Postcodes with long-distance connections have increased significantly, with house prices in Macgregor up 19.7 per cent in a year and 9.3 per cent in three months to $1.556 million.
In Coorparoo in the city’s south, the average house price rose 15 per cent in a year and 7.3 per cent in three months to $1.538 million.
This upscale suburb is significantly more expensive than the average Brisbane neighborhood at $860,465.
The cheaper satellite town of Logan is also gaining in value, with home prices in Meadowbrook up 14.9 percent in a year and 7.6 percent in three months to $697,994.
On the Gold Coast, house prices in Gilston rose 17 per cent annually and 4.5 per cent in three months to $1.081 million.
Adelaide prices also saw double-digit price growth, with Taperoo Beach house values up 12.7 per cent on the year and 8.5 per cent quarter on quarter to $617,139.
In Brisbane, double-digit growth was much more common in a city where more population growth is due to interstate rather than overseas migration
In the inner city, house prices in Toorak Gardens rose 12.3 per cent annually and 8.9 per cent in three months to $2.295 million, making it by far the most expensive postcode in South Australia’s capital.
Perth is also a thriving market, with prices in Yokine, in the city’s north, up 17.3 per cent over the past year and 5.6 per cent during the quarter to $842,876.
On a net basis, more than 400,000 migrants arrived in Australia in the year to August.
If this happens, the influx of skilled migrants and international students from abroad will exceed Treasury’s forecast of 315,000 arrivals for 2023–24.
Australia’s inflation rate of 5.4 per cent in the year to September is the highest in the OECD after New Zealand and well above the RBA’s target of 2-3 per cent.
