Housing values grow as sentiment improves
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The news: Housing values grew 0.6% in February, according to CoreLogic's national Home Value Index (HVI).
The numbers: The property data company's latest report said the 20 basis point acceleration from the 0.4% increase seen in January was the strongest monthly gain since October last year.
Each of the capital cities and rest-of-state regions recorded a lift in values over the month, except Hobart where the market fell 0.3%.
Perth continues to stand out with a substantially higher rate of growth compared to any other region, up 1.8% over the month. Adelaide (1.1%), Brisbane (0.9%) and the regional areas of SA (1.1%), WA and Queensland (both 1.0%) also show a consistently high rate of capital growth month to month.
Although growth rates in Sydney and Melbourne home values have levelled out, the monthly trend has accelerated, with Melbourne emerging from a three-month slump of negative monthly movements to record a subtle 0.1% rise in February.
Sydney dwelling values also moved back into positive territory over the past two months after recording a subtle decline in November and December.
The context: CoreLogic's research director said the ongoing rise in housing values reflects a persistent imbalance between supply and demand which varies in magnitude across cities and regions.
The re-acceleration in value growth has been accompanied by a bounce back in auction clearance rates, which averaged in the high 60% range through February. Consumer sentiment also recorded a solid rise in February, signalling a lift in confidence.
Although the pace of gains has shown some uplift, most regions are still recording value growth well below the highs of last year when the national index rose 1.3% in May.
What they said: “Housing values have been more than resilient in the face of high interest rates and cost of living pressures,” Lawless said.
“... However, it’s hard to see a significant rebound in values shaping up given downside factors. Affordability constraints, rising unemployment, a slowdown in the rate of household savings and a cautious lending environment, are all factors likely to keep a lid on value growth over the near term.”
The source: CoreLogic media release
