Powered by MOMENTUM MEDIA
subscribe to our newsletter

Sydney and Melbourne drive 10.2% rise in property prices

Property price increases in Sydney and Melbourne continue to drive up the average residential property price in Australia, despite moderation elsewhere.

The total value of Australia's 9.9 million residential dwellings increased by $145.9 billion to $6.7 trillion.

The mean price of dwellings in Australia rose by $12,100 over the quarter to $679,100.

According to figures released by the Australian Bureau of Statistics (ABS), residential property prices rose by 1.9 per cent between the March and June quarters, or by 10.2 per cent on the same period last year.

Sydney and Melbourne markets both rose by 13.8 per cent over the year, but the Melbourne market grew more rapidly between the March and June quarters (rising by 3 per cent, compared to Sydney’s 2.3 per cent).

Advertisement
Advertisement

Hobart followed in third place, with prices rising by 12.4 per cent year-on-year, or 1.8 per cent between the March and June quarters.

However, price growth in the Australian capital cities was less drastic; Adelaide, Brisbane and Canberra prices rose by 5 per cent, 3 per cent and 7.9 per cent, respectively, over the year.

On a quarter-on-quarter basis, Canberra grew by 1.3 per cent, Brisbane by 0.6 per cent and Adelaide by 0.8 per cent.

However, Darwin and Perth both saw drops in price over the year (4.9 per cent and 3.1 per cent, respectively).

Darwin saw the greatest fall in prices between the March and June quarters, with a 1.4 per cent drop.

PROMOTED CONTENT


Bruce Hockman, chief economist for the ABS, commented: "Residential property prices, while continuing to rise in Melbourne and Sydney this quarter, have begun to moderate. Annual price movements ranged from -4.9 per cent in Darwin to +13.8 per cent in Sydney and Melbourne. These results highlight the diverse housing market and economic conditions in Australia's capital cities.”

The disparity in the market conditions across the country has led some to call for changes to the way the market is regulated.

Senator Nick Xenophon revealed this week that he will help introduce legislation in 2018 that will change APRA's mandate to include competition, and require it to consider the differences in the housing market when bringing in macro-prudential measures.

Touching on APRA’s macro prudential measures to limit investor lending, he said: “These rules, intended to cool the overheated housing markets in Sydney especially, and Melbourne too, are too blunt an instrument.”

“They fail to take into account that the housing markets of, say, Townsville and Adelaide, and for that matter Rupanyup and Minyip, are very different from the frenzied markets of Sydney and Melbourne. 

“A more nuanced, calibrated approach is needed, and that could be achieved if APRA is required by law, in its objectives, not only to take into account its financial stability mandate, as it must, but secondary factors such as competition in the banking sector.”

As such, Mr Xenophon announced that he would help introduce legislation next year to “require APRA’s mandate to also include competition in the banking sector, to consider the differences in our housing markets between the two biggest cities and the rest of the nation (especially the regions) and also to require APRA to give weight to the impact a bank in a small regional community can have”.

“These seemingly little changes to APRA’s mandate can make an even bigger difference,” the senator said.

[Related: New laws will require APRA to consider competition and regionality]

Sydney and Melbourne drive 10.2% rise in property prices
mortgagebusiness

Are you a new-to-industry broker in the process of growing your business? Then there’s some great news: The Adviser’s New Broker Academy is back in 2021 and will provide you with essential insights into cutting-edge tools, strategies and processes to fast-track to success. Don’t miss your chance to attend. To secure your FREE place, visit newbroker.com.au now!

Annie Kane

Annie Kane is the editor of The Adviser and Mortgage Business.

As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts. 

Contact Annie at: This email address is being protected from spambots. You need JavaScript enabled to view it.

Latest News

The chief of Australia’s largest bank has said lenders should act pre-emptively and shift their floor rates for mortgage serviceability am...

Total household wealth reached a high of $13.4 trillion in the June quarter, primarily due to rising property prices, according to the Aust...

The property exchange settlement platform has been granted approval to establish an Electronic Lodgement Network in the ACT.  ...

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

How long do you think it should take to discharge a mortgage?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.