Australian housing values rose in June, marking the fifth consecutive month of growth.
According to Cotality, the housing values increased by 0.6% in June.
During the month, gains could be seen in every capital city except Hobart, where housing values fell by 0.2%.
In the June quarter, national home values grew by 1.4% following a 0.9% increase in the first quarter of the year and a 0.1% drop in Q4 last year.
The quarterly growth is nearly double the pace of wage growth in the same period, making Australian homes even more affordable for prospective buyers.
Every capital city and rest-of-state region recorded a rise in values, with the only outlier being Regional Tasmania.
While the quarterly pace of growth currently favours regional Australia at 1.6% compared to 1.4% in capital cities, Cotality predicts that the trend will swing back round to the combined capital cities in the coming months.
Cotality research director, Tim Lawless, said falling interest rates have created momentum in the market.
“The first rate cut in February was a clear turning point for housing value trends. An additional cut in May, and growing certainty of more cuts later in the year have further fuelled positive housing sentiment, pushing values higher,” he said.
“Although value rises have been broad-based, the pace of growth remains mild compared to mid-2023 when the quarterly rate of growth in national home values peaked at 3.3%, and for that matter, positively tepid relative to the extreme 8.1% quarterly peak growth recorded through the height of the pandemic.”
The official cash rate that informs borrowing costs has fallen from 4.35% to 3.85% this year and economists expect more rate cuts from the RBA next week.
Despite the rebound, home sales have been relatively low with the housing turnover through the first half of the tracking at an annualised pace of 4.9%, which is slightly below the decade-average turnover of 5.1%.
Advertised stock levels are also low, tracking 5.8% below the same time a year ago and 16.7% below the previous five-year average.
“Although demonstrated demand is tracking slightly below average, advertised supply is scarce, creating a more balanced market for buyers and sellers,” Lawless said.
“Improved selling conditions can be seen in auction clearance rates, which have risen to slightly above the decade average in the last two weeks of June, holding around the mid 60% range.”
