National housing values grew 22.1% in 2021, and there are two capital cities and one region in particular that are not ready to slow down just yet. Can you guess where?
Happy New Year everyone! To kick off 2022, we’re looking at how the property market performed across 2021, and what we can expect over the next 12 months.
The most recent CoreLogic data reveals there’s a two-speed housing situation emerging across the country, with prices in Sydney (+0.3%), Melbourne (-0.1%) and Perth (+0.4%) slowing down in December.
On the other hand, Brisbane (+2.9%), Adelaide (+2.6%) and regional Queensland (+2.4%) are set to defy 2022 slowdowns, with CoreLogic saying there’s “no evidence of their growth slowing just yet”.
In fact, the monthly rate of growth for each of these regions reached a new cyclical high in December.
“In Brisbane and Adelaide, housing affordability is less challenging, advertised stock levels remain remarkably low and demographic trends continue to support housing demand,” explains CoreLogic’s Research Director Tim Lawless.
Hobart (+1%), Canberra (+0.9%), and Darwin (+0.6%) meanwhile performed smack bang in the middle of the pack in December.
So what’s causing the slowdown in other markets?
The annual housing value gains in the nation’s two biggest cities, Sydney (+25.3%) and Melbourne (+15.1%), were stellar in 2021.
But momentum has slowed sharply, with both cities recording their softest monthly reading since October 2020.
The slowing trend can partly be explained by a bigger deposit hurdle caused by higher housing prices alongside low-income growth, says Mr Lawless, as well as negative interstate migration.
“A surge in freshly advertised listings through December has (also) been a key factor in taking some heat out of the Melbourne and Sydney housing markets,” adds Mr Lawless.
Slower conditions across the Perth housing market, meanwhile, may be more attributable to the disruption to interstate migration caused by extended closed state borders.
“This has had a negative impact on housing demand,” adds Mr Lawless.