Australia’s Home Price Gains Quicken With Sydney at Record High
Australia’s housing market climbed further in May and Sydney matched a record high as a supply shortfall and swelling population overshadowed the impact of high borrowing costs.
Mining-hub Perth surged 2% to be the best performing city, while Sydney advanced 0.6% and Brisbane climbed 1.4%, property consultancy CoreLogic Inc. said in a report on Monday. Prices in Melbourne edged 0.1% higher, resulting in an overall increase of 0.8% for Australia’s major cities.
“Inventory levels in these markets remain well below average despite vendor activity lifting relative to this time last year,” said Tim Lawless, research director at CoreLogic. “Fresh listings are being absorbed rapidly.”
Available housing supply, based on the number of homes advertised for sale over the past four weeks, remains well below average, the report showed. Capital city listings are 16% below the previous five-year average.
Prices in Sydney — the most expensive market in the country with a median price of A$1.16 million — equaled a record high first set in January 2022, Lawless said.
Australia’s property market surprisingly recovered last year despite the Reserve Bank’s aggressive policy tightening to rein in inflation. CoreLogic’s national home value index has advanced 35.6% since the onset of Covid-19, with Sydney climbing 27.2% during that period.
The RBA’s tightening cycle, combined with an acute shortage of dwellings and booming population growth, has sparked a housing crisis in large parts of Australia. The problem is particularly acute in Sydney where buyers are being priced out of the market given an average home costs 13-times income.
“To say the housing market has been resilient is an understatement,” Lawless said. “Housing values are continuing to rise across most areas and housing types. The common denominator remains a mismatch between housing supply and housing demand.
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