Australian housing market update: November 2021

Australian housing values rose 1.5% last month, a similar result to August and September. However, the trend shows the market is continuing to slowly lose momentum since moving through a peak monthly rate of growth in March 2021, when values were up 2.8%.

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Across the broad regions of Australia, market conditions are starting to show some diversity.  Perth recorded its first negative monthly result since June last year, with values nudging -0.1% lower. At the other end of the spectrum, Brisbane has taken over as the fastest growing market with housing values up 2.5% in October. This was followed by Adelaide and Hobart, with both markets increasing 2.0% in value over the month.  In Sydney and Melbourne, the monthly rate of growth has more than halved since the highs seen in March 2021, when they reached a monthly growth rate of 3.7% and 2.4% respectively.

Across the regional markets, New South Wales and Queensland led the pace of capital gains while Western Australia was the only broad rest-of-state region to record a marginal fall in housing values.

Slowing growth conditions are a factor of worsening housing affordability, rising supply levels, and less stimulus.  Housing prices continue to outpace wages by a ratio of about 12:1, which is one of the reasons why first home buyers are becoming a progressively smaller component of housing demand.  New listings have surged by 47% since the recent low in September and housing focused stimulus such as HomeBuilder and stamp duty concessions have now expired.  Combining these factors with the subtle tightening of credit assessments, which went live on November 1st, and it’s highly likely the housing market will continue to gradually lose momentum.

Although the monthly pace of growth is easing, the annual trend has continued to rise, which is a factor of the stronger growth conditions throughout early 2021.  Nationally home values are up 21.6% over the year to October, with half the capitals recording an annual growth rate in excess of 20%.  Across the broad regions of Australia, regional Tasmania has led the nation for the pace of annual capital gains with dwelling values rising by 29.1%.

Find out the latest news for each state by clicking the link and watching the videos below or read the full

Housing Market Update November 2021 Transcript

Sydney

Melbourne

Brisbane

Perth

Adelaide