Apartment Values Hit Record Highs
While detached dwellings took the spotlight, apartments have been on the rise.
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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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Stubborn inflation and just-out-of-reach interest rate cuts are the likely reasons for the softer end to the year, new data has revealed
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Australian capitals experienced their smallest rise in home values since January 2023, new data from CoreLogic has revealed.
The property data provider’s Home Value Index showed values rose by 0.1 percent over spring after 22 months of consecutive rises. CoreLogic predicted this could be close to the last rise in this cycle, with both the Sydney and Melbourne markets showing signs of cooling.
“The downturn is gathering momentum in Melbourne and Sydney,” said Tim Lawless, CoreLogic’s research director.“While the mid-sized capitals, which have dominated the growth cycle of late, are also losing steam.”
The trend was most obvious in Melbourne, with housing values recording drops in 10 of the past 12 months. Melbourne values fell by -1.0 percent in November, while Sydney experienced a fall of -0.5 percent. The report indicated that Sydney values had most likely peaked in August this year.
Some of the smaller capitals were also showing signs of a weakening in values, with Darwin down -0.7 percent and Canberra recording a drop of -0.3 percent.
“The mid-sized capitals and most of the regional ‘rest of state’ markets continue to provide some support for growth in the national index, but it is clear momentum is also leaving these markets,” added Mr Lawless.
However, it was a different story on the other side of the country, with Perth home values experiencing further growth. CoreLogic data showed values in the Western Australian capital up 1.1 percent over the month and 3.0 percent over the quarter. While the increases in values were the strongest amongst the capitals, CoreLogic noted that they were less than half that recorded in the June quarter, where they were at a robust 6.7 percent.
Mr Lawless pointed to a lack of movement in core inflation, as well as the diminishing likelihood of an interest rate cut early next year as factors in the subdued capital gains. Leading Australian economists are predicting a cut somewhere between February and May 2025.
“A lower cash rate will be a positive factor for housing markets,” Mr Lawless said. “Lower mortgage rates will provide a lift to borrowing capacity, and, along with lower inflation, should see an improvement in serviceability assessments and see a further rise in consumer sentiment.”
“A couple of rate cuts might be enough to shore up a declining trend in home values, but it is hard to see any material upward pressure returning until interest rates reduce more substantially and affordability barriers are less formidable.”
This stylish family home combines a classic palette and finishes with a flexible floorplan
Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.
