Australian home values rise for eighth month despite slowing growth

By Our Reporter
0
473
representational. Photo by Towfiqu barbhuiya on Unsplash

Australia’s housing market is experiencing a curious phase. On one hand, the CoreLogic Home Value Index rose by 0.9% in October 2023, marking the eighth consecutive month of rising home prices. On the other hand, the quarterly pace of growth has been slowing down. This paints a picture of a housing market that’s as complex as it is contradictory.

The upward march in home prices was seen across all capital cities except for Darwin, which saw a slight decline of 0.1%. Perth, Brisbane, and Adelaide led the charge with gains of 1.6%, 1.4%, and 1.3%, respectively. Yet, despite these monthly gains, a noticeable slowdown in the quarterly pace of growth was apparent, dropping from the previous quarter’s growth of 3.7% to a 2.6% decline in the three months ending in October.

Tim Lawless, CoreLogic’s research director, explained that the slower appreciation rate could likely be chalked up to higher advertised stock levels along with stretched affordability. “It’s unlikely buyer demand will be able to keep pace as we move through spring amid high interest rates and low sentiment,” Lawless stated.

It’s not just the low sentiment and high interest rates affecting buyer demand. An acceleration in new listings coming onto the market could also potentially outstrip buyer interest. While a surge in listings offers more options for buyers, it could tilt the market towards oversupply if demand falters.

Economists are taking note of the intricate dynamics at play. They argue that the rising home prices, despite economic constraints, highlight the resilience and complexity of Australia’s housing market. “The stretched affordability is a ticking time bomb for the housing market,” warned a noted economist. “Without regulatory intervention, we might see a more pronounced correction in the future, which could have wider economic repercussions.”

The divergence in home value growth across capital cities adds another layer of complexity. It’s not just a tale of one market; it’s a patchwork of varying regional performances, shaped by their individual economic drivers and hurdles.

The influx of new listings is indeed a double-edged sword. It provides a wider array of choices for potential homebuyers, but if demand can’t keep pace, we might be heading towards a market glut. Coupled with the already high interest rates, it’s making the dream of homeownership increasingly elusive for many Australians.

This isn’t just a real estate issue; it’s a topic of national discussion. The housing market is a crucial indicator of Australia’s economic health. The ongoing rise in home prices also stirs debates about the wealth gap and poses increasing challenges for first-time homebuyers.

Calls for regulatory intervention are growing louder. Experts argue that policy changes might be necessary to ensure housing affordability and market stability. Without taking steps to address the issue, we could be inching closer to a bubble that nobody wants to see burst.

The October 2023 CoreLogic Home Value Index reveals an Australian housing market that is as robust as it is fraught. With monthly gains painting one picture and a quarterly decline sketching another, it’s clear that this is a volatile landscape that demands close attention from all stakeholders. This year’s spring season could prove pivotal in determining whether Australia’s housing market will continue its hot streak or begin to cool down.


Support independent community journalism. Support The Indian Sun.


Follow The Indian Sun on Twitter | InstagramFacebook

 

Donate To The Indian Sun

Dear Reader,

The Indian Sun is an independent organisation committed to community journalism. We have, through the years, been able to reach a wide audience especially with the growth of social media, where we also have a strong presence. With platforms such as YouTube videos, we have been able to engage in different forms of storytelling. However, the past few years, like many media organisations around the world, it has not been an easy path. We have a greater challenge. We believe community journalism is very important for a multicultural country like Australia. We’re not able to do everything, but we aim for some of the most interesting stories and journalism of quality. We call upon readers like you to support us and make any contribution. Do make a DONATION NOW so we can continue with the volume and quality journalism that we are able to practice.

Thank you for your support.

Best wishes,
Team The Indian Sun

Comments