Massive Shortage in Housing Construction Continues
As Australia continues to work through a huge volume of new home…
10 August 2022
In capital cities Melbourne and Sydney, the real estate market has transformed into a buyers’ market. Perth, Brisbane, and Adelaide, however, have avoided house price falls.
Based on CoreLogic data, Sydney and Melbourne are the only capital cities to report dropped house value over the last quarter, 3% in Sydney and 2.4% in Melbourne. On the other end of the spectrum, Perth is the city that is reporting moderately rising value, over a slow, yet steady period.
Rising interest rates have yet to hit Perth and over the last financial year, the city has recorded a house price rise of over 26%.
Western Australia’s real estate institute (REIWA) president, Damian Collins, stated that migrants were starting to return to Western Australia and ‘we’ve got quite a significant shortage of housing at the moment and rental vacancy rates are near 40-year lows.’
Due to the rapid rate of growth in Sydney and Melbourne last year, they are the first to fall with rising interest rates, creating a buyers’ market that used to be a strong sellers’ market.
‘Considering inflation is likely to remain stubbornly high… it’s likely the rate of decline in housing values will continue to gather steam and become more widespread,’ Mr Collins said.