Most Capital Cities Recorded Growth in Home Values
September’s results show positive signs that Australia’s property market is on a good path to recovery. While national dwelling values experienced a 5th month of consecutive decline, the drop was mild at just -0.1%.
Australia’s biggest housing markets, Melbourne and Sydney, were responsible for this negative trend, dropping -0.9% and -0.3% respectively. That said, Sydney dwelling values have made consistent progress since July and Melbourne is expected to follow a similar trend once lockdown restrictions ease over the coming months.
Regional areas continue to outperform their metro counterparts. However, metro areas are starting to make a comeback with six out of eight capital cities recording growth in dwelling values this month.
Melbourne's Sigh of Relief
Metro Melbourne sighed in relief when it was announced in late September that the ban on property inspections was lifted. Our property portals are predicting that already-high pent up buyer demand will only continue to rise as restrictions ease and market activity resumes. In fact, the week after the inspection ban was lifted, Victoria’s Buyer Demand Index^ rose by 6.8%, making it the largest weekly increase recorded in the last 19 months.
As for the rest of Australia, the national Buyer Demand Index is 28.6% higher than this time last year, indicating that now is an excellent time to sell. What’s more, national listing volumes increased by 0.7% over the four weeks leading to 20th September. This demonstrates overall confidence is slowly returning to the market, which is predicted to continue as Australia finds its way to a COVID-normal.
Rental Market Trends
Similar to the for-sale market, regional rental markets have performed better than metro areas. The main reasons being that metro areas are more sensitive to immigration and industries highly affected by COVID, such as hospitality, and travel and tourism.
Most immigrants settle in metro areas because there are more job opportunities, and they tend to rent property upon arrival instead of buying. Industries most affected by COVID are largely made up of younger workforces, who are also more likely to afford renting over buying. These industries are more prevalent in metro areas because the population is denser, and vacationers traditionally prefer spending time in major cities.
There is another clear split in rental market performance, this time by property type with rental houses performing better than rental units. Both groups mentioned above tend to rent units over houses in metro areas due to availability and affordability, thereby explaining this divergence as well.
Australia's Most Popular Suburbs Revealed
COVID-19 has triggered a period of reflection for buyers, whereby many have reconsidered what they want from their next home – and more specifically, where their next home may be.
New data from Realestate.com.au reveals how the list of most popular suburbs by state has shifted since April 2020 when COVID first began impacting the market. With COVID-induced trends such as the work-from-home lifestyle becoming more common, it’s no surprise that more and more regional suburbs are making the list.
Has Your Suburb Made the List?
Based on Realestate.com.au’s Research Suburbs section*, here are the suburbs by state that have received the greatest increase in buyer interest since April 2020.
Wrapping it up
September marks what is believed to be the beginning of a steady, nationwide market recovery. There are many solid indications that fuel this belief, including improvements in national property values and rising consumer confidence. Plus, buyers are at the ready – so if you’re looking to sell your property, you are sure to be met with interest aplenty.
If you have questions about the process of selling privately, call our Private Property Specialists today on 1300 289 697. We’re always happy to help.
^Buyer Demand Index – a metric measured by Realestate.com.au that tracks high-intent buyer activity for the listings on their platform. High-intent buyer activity includes multiple visits to one listing, looking at a listing’s photos multiple times, saving or sharing the property, and submitting an enquiry
*Realestate.com.au’s Research Suburbs section provides buyers with detailed information on their suburb of interest, including key facts on lifestyle, property price expectations, and demand vs supply estimations.
- Harling, J. (2020, October 01). Lower home values in Melbourne and Sydney continue to weigh down the national housing market while the remaining capitals record a lift through September. Retrieved October 06, 2020, from https://www.corelogic.com.au/news/corelogic-hedonic-home-value-index-october-2020
- Kusher, C. (2020, September 29). Aussies Ramp Up Searches For New ‘Hoods In Wake Of COVID-19. Retrieved October 06, 2020, from https://www.realestate.com.au/insights/aussies-ramp-up-searches-for-new-neighbourhoods-in-wake-of-covid-19/
- Kusher, C. (2020, September 30). September 30 REA Insights Weekly Property Demand Report, 2020. Retrieved October 06, 2020, from https://www.realestate.com.au/insights/september-30-rea-insights-weekly-property-demand-report-2020/
- Owen, E. (2020, September 14). Corelogic Survey Suggests Residential Landlords Have Been Inclined To Keep Rents Steady During The COVID-19 Pandemic. Retrieved October 06, 2020, from https://www.corelogic.com.au/news/corelogic-survey-suggests-residential-landlords-have-been-inclined-keep-rents-steady-during
- Owen, E. (2020, September 25). CoreLogic sales and listings numbers reveal an unlikely city on the rebound. Retrieved October 06, 2020, from https://www.corelogic.com.au/news/corelogic-sales-and-listings-numbers-reveal-unlikely-city-rebound
- RP Data, C. (2020, October 01). Hedonic Home Value Index. Retrieved October 05, 2020, from https://www.corelogic.com.au/sites/default/files/2020-10/CoreLogic%20home%20value%20index%20Oct%202020%20FINAL.pdf?utm_medium=email&utm_source=solus&utm_campaign=indies_all_awareness_2021001