The suburbs where prices jumped more than $240k in three months - Australian Financial Review
The suburbs where prices jumped more than $240k in three months
Nila Sweeney Reporter March 4th, 2024 – 5:39pm - Financial Review.
House prices in the more expensive suburbs across Sydney and Melbourne gained as much as $242,000 over the past three months in what could become a turning point in those markets as sentiment improves, data from CoreLogic shows.
Eliza Owen, CoreLogic head of research, said the upturn in the upper end could be followed by stronger gains more broadly in the coming months.
House prices in Longueville in Sydney’s lower north shore climbed by $242,189 in just three months, according to CoreLogic.
“Some of the strongest green shoots in the quarter were happening at the high end of the market, and it shores up the view for growth in the Sydney market in the short term,” she said.
“If you look at the rolling quarterly growth in dwelling values through to February compared to the end of last year, it’s clear that the market has had an upward inflection after Sydney and Melbourne moved into a bit of a cyclical downturn.
“Coming through to the start of this year, it looks as though that sharp downswing has been avoided as prices picked up slight momentum last month.”
Sydney’s top performing suburbs were dominated by the lower north shore, Central Coast and the inner south-west, where house prices jumped around eight times faster than the city’s 0.6 per cent quarterly gain.
Longueville houses notched up the largest gain of $242,189 in the past three months or a 4.8 per cent lift in the median to $5.3 million, likely bolstered by strong demand from wealthy upsizers.
Houses in the inner west suburb of Haberfield climbed by $156,506, or a 5.2 per cent increase on the median price, to $3.14 million, while Lane Cove West racked up 4.6 per cent, or $129,778, capital gains in the past three months.
“Haberfield and Longueville are aspirational suburbs for many buyers due to their locations and houses are tightly held, so it can get competitive when a property comes into the market,” said Rich Harvey, chief executive of buyer’s agency Propertybuyer.
“We’re seeing local upgraders actively buying in those suburbs as sentiment improves. However, we’re still noticing some caution among buyers, and they’re quite selective at the moment due to the uncertainty of interest rate cut timing.”
Thomas McGlynn, chief executive of real estate agency BresicWhitney, said demand for the upper end of the market and the entry-level properties was particularly strong.
“We’ve noticed that anything that was considered a trophy home was achieving strong results at auctions as they are often scarce. Units in the desirable suburbs are also performing well as more people opt for affordable properties,” he said.
Central Coast suburbs Kincumber, Saratoga and Davistown all clocked up 4.5 per cent gains, or around $48,000 increase on average, while Mortdale, Narwee and Wiley Park in the inner south-west gained more than 4.4 per cent over the past three months.
“I think recent performance in the housing market has shown how responsive buyers can be to even the idea that the cash rate won’t move higher, let alone the demand effects we could see if the cash rate moves lower at the end of the year, which it is expected to do,” said Ms Owen.
“There’s probably more upside for Sydney and Melbourne housing markets toward the end of the year because of potential changes on the demand side – a change in the cash rate or a rise in real incomes, both of which are expected this year, would likely lift values through 2024.
“But until then, there are some economic headwinds at play, such as declining household savings rate, rising unemployment, even though consumer sentiment has lifted through February, it remains in very pessimistic territory. So it’s hard to say how long this boost to the housing market can last.”
In Melbourne, house prices in Carlton North, Abbotsford and Clifton Hill in the inner city, as well as Sorrento and Portsea in the Mornington Peninsula posted the sharpest increase in the past three months. House prices rose by at least 2.8 per cent, sharply outperforming the city’s 0.6 per cent decline during the same period.
Unit values in suburbs that have languished in the past couple of years such as North Melbourne, Carlton, Docklands and Southbank rebounded by up to 5.6 per cent, gaining around $21,000 on average.
Melbourne-based real estate agent Geoff White of Barry Plant Yarra’s Edge said demand for inner city units were mostly coming from first-home buyers and from those who want to live in the city.
“Most of these buyers are taking advantage of the lower prices for units as they haven’t increased much in the past few years, so they offer good value for money,” he said.
In Brisbane, inner suburb Kalinga recorded the fastest house price growth over the past three months, fuelled by demand from interstate buyers, according to Zoran Solano, buyer’s agent with Hot Property Buyers Agency.
“We’ve had a lot of people from Sydney or Melbourne who are relocating to Brisbane and are snapping up houses in Kalinga because of its bigger blocks and traditional Queenslander homes,” he said.
“For what they’re paying, they’re definitely getting more house for their dollars.”
In the past three months, house prices in Kalinga climbed by 10.3 per cent, adding $179,211 to the median.
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