Dwelling price growth at 8% annually

Aussie dwelling values have continued their upward, yet steady, trajectory with a further rise of 0.7 per cent in June, marking the 18th consecutive month of price rises, CoreLogic’s Home Value Index (HVI) has shown.

Over the 2023–24 financial year, values have grown 8 per cent, an equivalent of $59,000 added to the median dwelling value in Australia, which now stands at $794,000.

The HVI report noted the “stark contrast” between national index in comparison to FY22–23, which saw the index down by 2 per cent in a year that recorded a 7.5 per cent drop in values following up to the beginning of the monetary policy tightening cycle in May 2022.

However, the trend growth rate has since begun to ease despite the strong annual gains, dropping from the quarterly peak of 3.3 per cent.

In fact, the last three quarters have seen the growth rate of prices stay relatively consistent, with the June quarter 2024 recording values rose by 1.8 per cent, which was preceded by similar results in the March quarter (1.9 per cent) and the December quarter (1.8 per cent).

According to CoreLogic’s research director Tim Lawless, the national index has “found a groove”, rising between 0.5 and 0.8 per cent month on month since February this year.

“The persistent growth comes despite an array of downside risks including high rates, cost of living pressures, affordability challenges and tight credit policy,” Lawless said.

“The housing market resilience comes back to tight supply levels which are keeping upwards pressure on values.”

Meanwhile, PropTrack’s Home Price Index also lifted by 0.18 per cent, once again reaching a new peak during June, although this has marked the slowest pace of monthly growth since December 2022.

Nevertheless, prices have grown 10.14 per cent from the December 2022 trough, up by 3.14 per cent year to date to sit 6.55 per cent above June 2023 levels.

Eleanor Creagh, PropTrack’s senior economist, said housing demand has continued to be bolstered by strong population growth, tight rental markets, and home equity gains even after a lift in the number of homes hitting the market this year.

“Meanwhile, building activity remains challenged, resulting in the chronic shortage of housing being exacerbated by a lack of new construction,” she said.

Creagh said that buyer and seller sustainability has been largely due to interest rate stability, while the ongoing rise in home prices has motivated many to “overcome affordability challenges and transact with the expectation of further growth”.

“As a result, demand is outpacing supply, pushing prices and rents higher and offsetting the higher interest rate environment,” Creagh said.

“From July, tax cuts will lift household incomes increasing borrowing capacities and buyers’ budgets, further supporting price growth.

“Although home prices are expected to rise in the coming months, they will likely maintain a slower pace through the seasonally quieter winter period, particularly with increasing uncertainty around interest rates.”

[RELATED: Prices to jump 2–5% over FY25: PropTrack]