Melbourne gains driving national property market

Strong growth in the Melbourne property market is behind higher house prices nationwide, according to new data from property research firm CoreLogic.

 

The July 2017 CoreLogic Hedonic Home Value Index recorded a 1.5% increase in dwelling values across the combined capital cities for the month. While most capitals experienced an uptick, Melbourne was ahead of the pack with a 3.1% gain.

 

The recent bounce in capital gains may be partially due to a recovery from the seasonal slump in values recorded in April and May. However, other factors, such as stamp duty concessions for first home buyers in New South Wales and Victoria, may also be having a positive impact on market demand.

 

Melbourne appears to be benefitting from consistently high population growth which is creating strong demand for housing, as well as consistently high jobs growth and more affordable housing options relative to Sydney.

 

This quarterly slowdown was greatest in Australia’s hottest housing markets, falling from 5.0% in Sydney earlier this year to 2.2% at the end of last month. Likewise, Melbourne’s figures also dropped from 5.5% to 4.2% in the same time period.

 

Auction clearance rates in Sydney and Melbourne have also diverged with Sydney’s falling below 70% while Melbourne remains around 75%.

 

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