NAB’s Chief Economist, Alan Oster provides his thoughts on the Australian and Global economy.
Nationally, housing values were up 0.7% in March, a subtle increase on the 0.6% lift recorded in February.
The uptick in the monthly rate of growth was primarily driven by stronger conditions in Brisbane, Adelaide, Perth and the ACT, along with several regional areas, offsetting a slip in values across Sydney and Melbourne.
The first quarter of the year has seen Australian dwelling values rise by 2.4%, adding approximately $17,000 to the value of an Australian dwelling. To put the latest growth rate into some context, a year ago, values were rising at more than double the current pace, up 5.8% before the quarterly rate of growth peaked at 7.0% over the three months ending May 2021.
Sydney’s growth rate is showing the most significant slowdown, falling from a peak of 9.3% in the three months to May 2021, to 0.3% in the first quarter of 2022. Melbourne’s housing market has seen the quarterly rate of growth slow from 5.8% in April last year to just 0.1% over the past three months.
While the monthly rate of growth was up among some cities and regions, there is mounting evidence that housing growth rates are losing momentum. Virtually every capital city and major rest-of-state region has moved through a peak in the trend rate of growth some time last year or earlier this year. There are a few exceptions to the slowdown, with regional South Australia recording a new cyclical high over the March quarter and some momentum is returning to the Perth market where the rate of growth is once again trending higher since WA re-opened its borders.
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