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Australian housing now worth over $8 trillion

Residential real estate in Australia is now worth more than $8 trillion, four times the size of the country’s GDP, following a surge in values.

According to property data and analytics company CoreLogic, the total value of home dwellings now totals $8.1 trillion, marking the first time the value has surpassed the $8-trillion mark.

The new record comes as many markets have experienced surges in property values this past year, amid strong buyer demand, low supply and record-low interest rates and incentives bringing more buyers to market

CoreLogic’s head of research, Eliza Owen, noted that broad-based capital gains had resulted in several markets having reached their peaks.

She commented: “The Australian dwelling market has reached fresh record highs for the past four months, but the end of April marked the first time the total value of Australian housing broke the $8-trillion mark. 

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“This puts Australian residential property at around four times the size of Australian GDP, and  around $1 trillion more than the combined value of the ASX, superannuation and commercial real  estate stock combined.” 

According to CoreLogic data, in the three months to April, national home values rose 6.8 per cent, which is the highest quarterly dwelling growth rate since December 1988. 

Sydney and Canberra led the way in house price growth the past three months to April, rising 8.8 per cent and 6.7 per cent, respectively.

These markets have seen marked rises in prices for higher-value properties (e.g. the highest 25 per cent of property values).

Nationally, dwelling values are 7.8 per cent higher over the year, and sit around 7.6 per cent above the previous high, set in October 2017.

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“The increase in the value of residential real estate has put Australian home owners in a strong  equity position, with the RBA estimating just 1.3 per cent of housing loans to be in a negative equity position at the start of 2021,” Ms Owen said.

“However, for many Australians looking to get a foot on the property ladder, the continued strength in the market is putting home ownership further out of reach despite record-low mortgage rates. Wages growth simply isn’t keeping pace,” she added.

CoreLogic data also show that while quarterly price growth is elevated, the rolling 28-day change in its Home Value Index has started to slow, “suggesting that momentum is easing across dwelling markets”.

[Related: House prices reached record high in March quarter]

Australian housing now worth over $8 trillion
Australian housing now worth over $8 trillion
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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.

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