House prices boomed in 2016
Home values ended the year at their fastest growth rate since 2009.
The CoreLogic Hedonic Home Value Index for December shows capital city home values up 10.9% for the 2016 calendar year. According to CoreLogic, capital gains combined with gross rental yields brought the total annual return for capital city housing to 14.7%.
Sydney led the way for house price growth, up 15.5% for the year. Median house prices in the city grew by approximately $10,000 per month. Melbourne saw strong gains as well, with dwelling values rising 13.7%. Perth was the only capital city to see a year-on-year decline, as home values fell 4.3% in the city.
Australian property in 2016: Year in review
CoreLogic head of research Tim Lawless said there was significant disparity in growth rates between houses and units. House values were up 11.6%, while unit values were up only 5.9%.
“The divergence in growth rates is the most distinct in Melbourne and Brisbane, where concerns around unit oversupply have eroded buyer confidence. Melbourne house values are up 15.1% over the year compared with a 1.7% rise in unit values, while Brisbane house values are 4.0% higher over the year, with unit values falling by 0.2%,” Lawless said.
Lawless said regional areas also lagged behind, showing only 2.8% growth for the year. Regional New South Wales saw the strongest growth at 7.3%, while regional Western Australia saw a 7% decline.
“Those regional areas with intrinsic ties to the mining and resources sector have continued to record weaker housing market conditions since the end of the mining infrastructure boom, with Perth and Darwin recording the weakest housing market conditions across the capital cities,” Lawless said.
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