The property boom in Australia is quickly gathering momentum, with house prices rising faster in February than they have for 17 years.
With record-low interest rates, the improving economy, lack of supply and a raft of government stimulus measures, national home values jumped 2.1 per cent in just one month.
According to the CoreLogic national home value index that’s the largest increase since August 2003.
In a return to form, Melbourne and Sydney actually were the two of the best performing capital cities.
CoreLogic’s Tim Lawless said the numbers were phenomenal given the world was in the grip of a pandemic.
“These are extraordinary numbers,” he told Domain.
“When you look at how broad-based in nature this property growth upswing is, we haven’t seen every capital city and regional markets rising since post-GFC.
“We’re seeing regional markets outperform capital cities. The last time we saw regional growth was back in October 2003. This stands out as quite a phenomenal month of growth in the context of history.
“Consumers are a lot more confident but that’s against low supply levels,” he said.
“In many ways you’ve got a mismatch between supply and demand that is creating a lot of urgency amongst buyers, which is a key factor in pushing house prices.”
Domain senior research analyst Nicola Powell says big numbers attending auctions in Melbourne had seen a return to the ‘fear of missing out’ factor from buyers.
“This market is not for the faint-hearted and it is challenging conditions for buyers to purchase under,” she told Domain.
“The only winners out of a rising market like this are those who are downsizing and are tapping out of a real estate market.”
As prices rise it should tempt more sellers to list their properties which could take the heat out of the market down the track but that could still be some months away.