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It's official: the price of the average freestanding home in an Australian capital city is now a number with seven digits.
New data in Domain's Quarterly House Price Report shows that the median combined capital house price is now just over $1.06 million – up dramatically from $850,000 in September 2020.
Year-on-year that represents growth of more than 25 per cent, smashing all existing records and outstripping the growth of units more than three times over.
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According to Domain's Chief of Research Dr Nicola Powell, the main factor shovelling coal into the property furnace was the simple fact that more Australians were ready and willing to buy a home than there were those ready to sell.
"House and unit prices continue to beat records nationally due to lockdown activity rebounds in Sydney, Melbourne and Canberra, high household savings and the ongoing demand from Australians to buy a property," Dr Powell said.
"Demand continues to outstrip supply across a majority of the cities however rapid price growth and affordability issues are likely to shift demand in 2022.
"Price growth has slowed from earlier in 2021 but it is higher than last quarter."
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In the most expensive capital city of Sydney, house prices rose by roughly $1100 a day during 2021, taking the median price up $400,000 to a wallet-busting $1.6 million.
At 33.1 per cent growth, this is Sydney's steepest annual rate of growth on record.
Dr Powell said wildly upward prices are beginning to hurt the bottom end of the market.
"House prices have grown four times faster than units over the past year, a divergence that has created a record price gap with houses now double the price of a unit," she said.
"The rapid escalation in price is proving to be a significant financial barrier to entry for buyers and upgraders against a backdrop of low wage growth. Housing affordability will continue to weigh on demand throughout 2022."
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While not as stratospheric as Sydney, other capital cities also enjoyed record gains.
Melbourne's median house price is now a record $1.1 million, Brisbane's is now $792,065 and Adelaide's is a record $731,547.
"Current demographic trends will continue to support housing demand with more people arriving into Greater Adelaide than leaving," explains Dr Powell.
"South Australia has been one of the states to benefit from the flow of Australians that have sought to either escape lockdown, embrace remote work culture, or return to their home state."
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Every single capital city recorded year-on-year growth in 2021, while only Darwin failed to edge higher in the December quarter. The median house price in the top end capital is now $645,487 – only slightly more expensive than the cheapest capital in the country in Perth, where the median house price is $612,348.
In Hobart, where buyers could have easily scooped a property for under half a million five years ago, the median house price is now $752,110 – a staggering 34.6 per cent year-on-year growth.
"Hobart's streak of record-breaking house prices hit a milestone over the last quarter by surpassing $700,000 for the first time. With the lowest average wages of all the states we can expect that entry-level buyers who are on a local average wage will find it increasingly difficult to enter the housing market," Dr Powell said.
"Values have risen sharply across all house price points suggesting a broad spectrum of buyers are active.
"Home hunters will find buying conditions to be fierce as the number of homes for sale is well below the five-year average, and while stock is starting to build, it remains tight."
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Australia's capital city median house prices*
|
Capital City: |
Median House Price: |
Year-on-year growth: |
|
Sydney |
$1,601,467 |
+ 33.1 per cent |
|
Melbourne |
$1,101,612 |
+ 18.6 per cent |
|
Brisbane |
$792,065 |
+ 25.7 per cent |
|
Adelaide |
$731,547 |
+ 27.5 per cent |
|
Canberra |
$1,178,364 |
+ 36.6 per cent |
|
Perth |
$612,348 |
+ 7.5 per cent |
|
Hobart |
$752,110 |
+ 34.6 per cent |
|
Darwin |
$645,487 |
+ 30.1 per cent |
|
Combined Capitals |
$1,066,133 |
+ 25.2 per cent |
*Domain December 2021 Quarterly House Price Report
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Source: 9News
