Further gains tipped for Sydney and Melbourne: ANZ

Despite tentative auction listings and home prices over the past week, ANZ Research’s David Cannington still expects growth in the Sydney and Melbourne markets.

In his recent Australian Housing Market Update Cannington noted that Sydney and Melbourne in particular are recording positive home buyer sentiment, with clearances in excess of 70%, even while vendors “remained reserved with the number of auctions around trend levels”.

Steady consumer confidence and elevated clearance rates in more recent weeks are evidence of a short-term demand.

Similarly, house price gains were a mixed bag. While Sydney, Melbourne and Brisbane eased over the week, Adelaide and Perth edged a little higher.

Since the beginning of August, Cannington noted that the prices have increased in trend terms across all, bar one, of the capitals. Brisbane is the capital that was left behind from this growth.

This leads Cannington to conclude that further gains are expected for Sydney and Melbourne, although at a moderated level.