Sydney has regained its crown of best-performing capital city for dwelling value growth as the Australian property market continues its strong march through 2021.
The NSW capital posted a quarterly increase of 9.3% in the three months to 31 May, according to the latest CoreLogic figures, with only Darwin's quarterly growth of 7.9% coming close to matching it.
All other capital city markets also continue to post positive monthly and quarterly gains, however, while regional areas continue to outperform the capitals. Regional NSW, for example, has gone up by 18.6% over the past 12 months compared with 11.2% for Sydney.
Among some of the other eye-watering numbers highlighting strong growth across the nation is an annual increase of more than 20% for properties in Darwin, and more than 3% for Hobart in the month of May alone (though figures tend to be more volatile in the smaller markets).
"Such a synchronised upswing is an absolute rarity across Australia’s diverse array of housing markets," said CoreLogic research director, Tim Lawless, noting that regional WA is the only market in Australia not to have seen any value increase over the past 12 months.
"The combination of improving economic conditions and low interest rates is continuing to support consumer confidence which, in turn, has created persistently strong demand for housing.
"At the same time, advertised supply remains well below average. This imbalance between demand and supply is continuing to create urgency amongst buyers, contributing to the upwards pressure on housing prices."
CommBank Senior Economist, Belinda Allen, noted that "price rises for units have underperformed price rises for detached houses in the recovery [from the COVID-19-fuelled lows of 2020].
"This has been driven by two main forces; owner-occupiers were the first to return to the housing market post the worst of COVID-19 and the desire for more space post lockdowns fuelled the recovery in detached houses, while the closure of international borders has reduced demand for units," she said.
"Once borders are reopened and student numbers rise we expect that there will be some catch-up for units."
Allen and Lawless both predict property prices will continue to rise over the next 12 months, with both pointing to strong new lending, auction clearance and investment levels combined with low interest rates and a recovering labour market.