Sydney house values jump over three percent in November: CoreLogic
Sydney house values jumped over three per cent over the month of November, growth not seen over a month since the late 1980s.
Dwelling values in the harbour capital grew by 2.7 per cent, led by house values (+3.1 per cent), CoreLogic's November update showed.
Units also saw strong 1.8 per cent gains.
Sydney hadn't seen dwelling values rise that high and that quickly since 1988 when in October they rose 3.5 per cent.
The November 2019 figures topped that of May 2015 when dwelling prices rose 2.6 per cent.
The house value jump takes Sydney's quarterly gains above Melbourne as the two fight it out over who claims top spot in the recovery.
Sydney house values have grown seven per cent over the quarter, compared to Melbourne's 6.9 per cent, after the Victorian capitals 2.4 per cent house value gain in November.
Melbourne's dwelling values are still higher than Sydney over the quarter, driven by their stronger recovery in the apartment market (+5.3 per cent compared to Sydney's +4.2 per cent.)
CoreLogic's head of research Tim Lawless said that although housing values are rising across each of the valuation cohorts, the recovery trend is most concentrated within the premium sector of the market.
"This trend is most evident in Sydney and Melbourne where the top quartile of the market is outperforming the broad ‘middle’ of the market and lower quartile," Lawless noted.
"Values across Sydney’s top quartile were up 7.4% over the three months ending November, compared with a 3.8% rise across the lower quartile.
"Similarly, in Melbourne, top quartile values were up 8.1% over the same three month period compared with a 4.2% rise across the lower quartile.
“The stronger performance across the higher value end of the market can likely be attributed to a combination of values falling more in this sector during the downturn, as well as recent adjustments to serviceability rules which has boosted borrowing capacity. Additionally, the scarcity value of detached homes in many of the blue-chip property markets is another factor supporting strong capital gains.
“As housing values become less affordable in these high-end markets, demand is likely to ripple outwards to the more affordable areas,” Lawless said.
Sydney and Melbourne dwelling values are now positive for the first time in 12 months.
Sydney houses are up 2.1 per cent, Melbourne's 0.9 per cent.
“The Australian housing market is now five months into an unexpected period of rapid recovery. The question is, how long can such a high pace of capital gains be sustained?”
“Annualising the growth rate over the past three months implies the national index is already tracking well above double digit annual growth (+15.3%), while Sydney and Melbourne dwellings are tracking around the mid-twenty percent range for annualised capital gains based on the most recent three month trend."