Yesterday, CoreLogic announced Australian home values reached an all-time high in January, as the data company released its monthly home value index numbers. The cities leading national performance over the past 12 months were Darwin and Canberra, however regional areas have outperformed the combined capitals. Owner occupiers are driving the market, with ABS figures showing that lending to owner occupiers increased by 38.9 percent in the 12 months to December 2020. Annual growth for investor lending increased by 10.9 percent, leading to an all-time record volume of new housing finance in December 2020.
With Sydney’s status as Australia’s most populous centre and negative net interstate migration, the city generally relies on net overseas migration (NOM) for population growth. Since NOM has stalled over the past 12 months, the ongoing Sydney diaspora is being felt in other cities and regional areas. CoreLogic suggest remote working arrangements are now contributing to this trend, as is housing affordability and lower density housing options.
Nevertheless, Sydney dwelling prices are 2 percent higher than they were 12 months ago. In fact, the only capital city which recorded negative growth between January 2020 and January 2021 was Melbourne, which is likely still recovering from unique coronavirus restrictions it endured in the latter half of 2020. By Q4 2020, the CoreLogic Daily Home Value Index for Melbourne had turned upward and began its post-lockdown recovery. As global movement begins to ramp back up again, the floodgates of NOM will reopen in our major capitals.