Property value and mortgage finance still growing for December quarter
Sydney and Melbourne are still the hottest property markets, with dwelling value growth for all other capitals staying under 21%.
CoreLogic released its Property Pulse today, which shows dwelling values in Australia’s two biggest property markets, Sydney and Melbourne, growing by 70.5% and 52.1%, respectively. The other capitals had their dwelling values grow at a substantially lower rate, with Perth showing the slowest growth at 8.6%.
“The current housing market growth phase has really been all about Sydney and Melbourne.” CoreLogic head of research Cameron Kusher said.
“The rise in values has been supported by low interest rates and availability of mortgage finance, however, other factors such as localised economic performance, population growth and foreign demand have driven the much stronger growth in Sydney and Melbourne than across the other capital cities.”
Similarly, the data for mortgage finance showed New South Wales and Victoria sitting above the rest of the capital cities. New South Wales saw housing finance to the value of $14.5 billion in the December 2016 quarter, with 53% of this being owner occupier lending. Victoria had $9.6 billion value in home lending with a higher percentage of owner occupier loans of 62%.
On the opposite end, Tasmania, Northern Territory and ACT all sat at the bottom end of housing finance, with all three states not quite reaching the billion dollar mark in mortgage lending.
“While steps have been implemented to cool mortgage demand, particularly from investors in Sydney and Melbourne, the data points to the fact that demand is unquestionably, very strong,” Kusher said.
“Clearly with interest rates remaining at close to historic lows, further changes will be required in order to slow mortgage demand and dampen the increases in dwelling values being experienced in Sydney and Melbourne.”
- 8 big economist predictions for 2022 (and how they impact you)
- Housing affordability is in the toilet (and the toilet’s getting expensive)
- Room for improvement: Renters are less happy, more stressed than homeowners
- Could investors make it harder for you to buy a home in 2022?
- Finder’s RBA survey: 77% of experts say major banks will follow CBA’s crypto decision