Apartment Values Hit Record Highs
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Apartment Values Hit Record Highs

While detached dwellings took the spotlight, apartments have been on the rise.

By Terry Christodoulou
Thu, Sep 23, 2021 4:47pmGrey Clock < 1 min

Apartment markets around the country have broken previous records to reach new highs after rebounding from the pandemic’s first wave in 2020.

More than half of the 994 unit markets analysed are sitting at record highs according to a CoreLogic analysis.

Aside from 56.3% of the unit market reaching a new benchmark, the market has posted an average growth of 16.1% in value since the start of stage 2 restrictions at the end of March last year.

Although headlines have covered the detached housing markets record-breaking price gains, apartment prices are catching up with the recovery – including in coastal areas.

Now, nearly 64.4% of the 560 record-breaking unit markets are in capital cities – growing up to $595,000 in value during the period.

Unsurprisingly, apartment values in Sydney’s eastern suburbs of Darling Point and Rose Bay hit new highs – surging 26.6% and 25% respectively since March last year.

However, the coveted location wasn’t the fastest-growing apartment market within a capital city. That title goes to Blue Bay on the NSW Central Coast with a 36.5 %jump in value, followed by Sandy Bay in Hobart with 33.9% growth.

Elsewhere the want for a coastal lifestyle brought Avalon Beach and Warriewood’s northern beaches to new heights up 25.6% and 25.1% respectively.

In the regions, Portarlington in Victoria’s Bellarine Peninsula hit ranked highest with a 47.8% jump while Shoalhaven Heads south of Sydney and Moss Vale in the NSW Southern Highlands also racked up strong growth of 44.9% and 41.1% respectively.

CoreLogic’s analysis was based on the hedonic index, taking into account the combined value of the unit market in the suburb excluding data for Perth and regional WA.



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How much income is required to service a mortgage? It depends on where you live

New research suggests spending 40 percent of household income on loan repayments is the new normal

By Bronwyn Allen
Thu, Apr 25, 2024 3 min

Requiring more than 30 percent of household income to service a home loan has long been considered the benchmark for ‘housing stress’. Yet research shows it is becoming the new normal. The 2024 ANZ CoreLogic Housing Affordability Report reveals home loans on only 17 percent of homes are ‘serviceable’ if serviceability is limited to 30 percent of the median national household income.

Based on 40 percent of household income, just 37 percent of properties would be serviceable on a mortgage covering 80 percent of the purchase price. ANZ CoreLogic suggest 40 may be the new 30 when it comes to home loan serviceability. “Looking ahead, there is little prospect for the mortgage serviceability indicator to move back into the 30 percent range any time soon,” says the report.

“This is because the cash rate is not expected to be cut until late 2024, and home values have continued to rise, even amid relatively high interest rate settings.” ANZ CoreLogic estimate that home loan rates would have to fall to about 4.7 percent to bring serviceability under 40 percent.

CoreLogic has broken down the actual household income required to service a home loan on a 6.27 percent interest rate for an 80 percent loan based on current median house and unit values in each capital city. As expected, affordability is worst in the most expensive property market, Sydney.

Sydney

Sydney’s median house price is $1,414,229 and the median unit price is $839,344.

Based on 40 percent serviceability, households need a total income of $211,456 to afford a home loan for a house and $125,499 for a unit. The city’s actual median household income is $120,554.

Melbourne

Melbourne’s median house price is $935,049 and the median apartment price is $612,906.

Based on 40 percent serviceability, households need a total income of $139,809 to afford a home loan for a house and $91,642 for a unit. The city’s actual median household income is $110,324.

Brisbane

Brisbane’s median house price is $909,988 and the median unit price is $587,793.

Based on 40 percent serviceability, households need a total income of $136,062 to afford a home loan for a house and $87,887 for a unit. The city’s actual median household income is $107,243.

Adelaide

Adelaide’s median house price is $785,971 and the median apartment price is $504,799.

Based on 40 percent serviceability, households need a total income of $117,519 to afford a home loan for a house and $75,478 for a unit. The city’s actual median household income is $89,806.

Perth

Perth’s median house price is $735,276 and the median unit price is $495,360.

Based on 40 percent serviceability, households need a total income of $109,939 to afford a home loan for a house and $74,066 for a unit. The city’s actual median household income is $108,057.

Hobart

Hobart’s median house price is $692,951 and the median apartment price is $522,258.

Based on 40 percent serviceability, households need a total income of $103,610 to afford a home loan for a house and $78,088 for a unit. The city’s actual median household income is $89,515.

Darwin

Darwin’s median house price is $573,498 and the median unit price is $367,716.

Based on 40 percent serviceability, households need a total income of $85,750 to afford a home loan for a house and $54,981 for a unit. The city’s actual median household income is $126,193.

Canberra

Canberra’s median house price is $964,136 and the median apartment price is $585,057.

Based on 40 percent serviceability, households need a total income of $144,158 to afford a home loan for a house and $87,478 for a unit. The city’s actual median household income is $137,760.

 

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