PropTrack Home Price Index: Melbourne Has Strongest Price Growth In Six Months, Lags Rest Of Nation

Melbourne’s home price growth heated up in February, but remains below figures being seen interstate. Picture: Valeriu Campan.

Melbourne home values have had their strongest growth in six months, as units gained almost $7000 and houses made close to $1300 in February.

But the growth is lagging behind the rest of the nation, with the Victorian capital’s property values being kept relatively flat by heightened numbers of homes hitting the market giving buyers more choice.

PropTrack’s latest Home Price Index revealed the cost for a typical dwelling in the city, covering both houses and units, rose about $10,600 (1.33 per cent) from $786,400 to $797,000 in the 12 months to February 29.

This was about a tenth of the dollar growth Perth and Adelaide experienced, with their medians skyrocketing around $103,000 (16.32 per cent) and $90,400 (12.76 per cent) to $651,000 and $709,000, respectively.

The more rapid growth is even helping other capitals catch up to Melbourne, with Brisbane’s typical house and unit prices now just short of ours.

Median house and unit values for February were $909,000 and $607,000, up by around $1273 (0.14 per cent) and $6920 (1.14 per cent) since last month, respectively.

PropTrack senior economist Eleanor Creagh said January was one of the busiest January’s in more than a decade in Melbourne in terms of new listings and the number of homes for sale had been well above the decade average since August last year.

“But we’ve seen that demand has kept up with that increase and that’s continuing to support property values,” Ms Creagh said.

“And the pace of growth in Melbourne has accelerated after decelerating towards the end of 2023.

“It’s actually the city’s strongest pace of monthly growth since August.”

Ms Creagh said Melbourne’s home price growth “accelerated” in February after slowing towards the end of 2023.

Brisbane’s median dwelling price was also on par with Melbourne’s, with both sitting at $797,000 in February.

Ms Creagh said this was largely due to the composition of homes in each city as the large volume of units in Melbourne weighed down the aggregate dwelling median.

But she said Brisbane house prices were also likely to surpass Melbourne’s if the Victorian capital’s price recovery continued to lag.

Wallace Advocates director Emily Wallace said while there was a surge of stock that had listed recently, there was a lack of “A grade real estate” available.

“Three bedroom townhouses or villa units that have a good land component anywhere from $900,000-$1.2m are (at) quite a competitive price point,” Ms Wallace said.

“Heading into family home territory in really good school zones; around Auburn and Hawthorn, anything that’s $2.2m-$2.7m is very, very competitive.”

She added that “rentvestors”, or those that owned a rental property and were renters themselves, seemed to be selling their investments to buy a home.

As a result, Ms Wallace said she believed Melbourne had yet to reach its peak of first-time buyers entering the market.

“As tenancies are coming up for renewal and the (rent) increases are coming, that’s when we’re getting more and more first time buyers come in (to the market),” she said.

Article Source: Click Here