Dwelling prices in the Australian capitals are growing at their fastest 12-month speed since 2010, with Sydney posting its fastest price growth in 15 years, according to new estimates.
Between March 2016 and March 2017, prices in the eight big cities rose by 12.9 per cent, property data firm CoreLogic reported on Monday.
Dwelling prices (houses plus units) haven’t increased this much in a 12-month period since May 2009-May 2010 on a national basis.
It brought CoreLogic’s estimate of the median capital-city dwelling price to $585,000, with Sydney ($805,000), Melbourne ($605,000) and Canberra ($586,000) the most expensive.
Sydney was also the biggest contributor to the rapid growth. Prices there rose 18.88 per cent over the last 12 months, a growth rate we haven’t seen since Nov 2001-Nov 2002.
Year-on-year dwelling price growth also broke into double digit percentages in Melbourne (15.9), Canberra (12.8) and Hobart (10.2).
Dragging down the capital-city average over the last 12 months were Perth (-4.7), Darwin (-4.4), Adelaide (+3.4) and Brisbane (+3.7).
CoreLogic head of research Tim Lawless blamed the price surge on low interest rates and investor demand.
“This became evident through the second half of 2016, fuelled largely by lower mortgage rates and a rebound in investment activity,” Mr Lawless said in a statement.
The disparity between the four high-growth cities (Sydney, Melbourne, Canberra, Hobart) and the low or negative growth cities (Perth, Darwin, Adelaide, Brisbane) was the result of big variations in local rates of economic growth, migration and apartment supply, he said.
While Sydney led this year’s first-quarter growth, at 5 per cent, it was Melbourne prices that grew the most in the month of March, at 1.9 per cent, compared with Sydney’s 1.4 per cent.
Over the quarter, dwelling prices in the eight capitals grew by 3.5 per cent, and by 1.4 per cent in March.
As mentioned above, CoreLogic’s ‘dwelling’ prices include both houses and units. For houses, year-on-year price growth in the eight capital cities was 13.4 per cent. And for units, it was 9.8 per cent.