In February, the Australian housing market saw a subtle re-acceleration in housing values, reflecting improving sentiment across the country. According to CoreLogic's national Home Value Index (HVI), housing values rose by 0.6%, marking the strongest monthly gain since October last year.
Every capital city and rest-of-state region recorded an increase in values, except for Hobart, where the market fell by -0.3
%. This resilience in housing values comes amidst high interest rates and cost of living pressures, indicating a persistent imbalance between supply and demand.
Perth stood out with the highest rate of growth, up 1.8% over the month, followed by Adelaide (+1.1%), Brisbane (+0.9%), and regional areas of SA, WA, and Queensland (all +1.0%). These regions are benefiting from comparatively lower housing prices and positive demographic factors supporting housing demand.
While growth rates in Sydney and Melbourne have stabilised, both cities have seen an acceleration in the monthly trend. Melbourne, in particular, emerged from a three-month decline to record a subtle 0.1% rise in February. Sydney also moved back into positive territory after a slight decline in November and December.
The re-acceleration in value growth has been accompanied by a rebound in auction clearance rates, averaging in the high 60% range in February. Consumer sentiment also rose solidly during the month, indicating increased confidence in the housing market.
Despite these positive signs, most regions are still recording value growth below the highs of last year. Affordability constraints, rising unemployment, and a cautious lending environment are factors likely to keep a lid on value growth in the near term.
Overall, while the housing market has shown resilience, significant rebound in values is unlikely given the prevailing downside factors.
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