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Record house prices tipped to soar even higher as sellers go missing

Business

House prices would continue to grow beyond the current record levels because buyers now faced a severe shortage of properties for sale, according to CoreLogic.

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Its report for January said buyer demand was outpacing new stock additions to the market and this would mean “upwards pressure” on house prices.

Brisbane’s house prices rose 0.9 per cent in January but that was nothing compared to the 1.6 per cent in regional Queensland. On an annualised rate those figures would result in a 10.8 per cent rise for Brisbane this year and almost 20 per cent for regional Queensland.

However, there is speculation from economists that there could now be an interest rate rise later this year, three years earlier than previously forecast, but CoreLogic said this was unlikely given low inflation and higher-than-usual unemployment.

The growth in prices has also been tempered in Sydney and Melbourne because of the collapse of immigration levels during the pandemic.

Since the onset of COVID-19 in March last year, regional housing values (nationally) have surged 6.5 per cent higher while capital city housing values were down 0.2 per cent over the same timeframe.

The poorer performance from the cities started changing about six months ag0 and accelerated three months ago.

CoreLogic said home buying activity was ramping up with the number of mortgage-related valuations already 27 per cent higher than a year ago.

CoreLogic’s Tim Lawless said the volume of capital city house sales were up almost 12 per cent on the decade average.

“This is a sellers’ market, but for some reason, we are seeing below-normal vendor numbers across most markets,” Lawless said.

“With sentiment rising and selling conditions favouring the vendor, it is reasonable to expect new listing numbers will rise as the year progresses which may help temper housing market conditions.”

The same could not be said for the unit market with demand falling to record lows. Lawless tipped the unit market would continue to show underperformance compared with houses.

The best performing capital for the past 12 months has been Darwin with a rise of 11.4 per cent, followed by Canberra on 8.5 per cent. Brisbane has recorded a 4 per cent rise for the past 12 months.

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