Australian residential property market reaches $10.2 trillion value

The residential real estate sector in Australia has achieved a noteworthy milestone, with the combined value of residential property soaring to an impressive $10.2 trillion as of October’s end according to property analysts CoreLogic . October’s figure marks an increase from the $10.1 trillion posted in the preceding month, suggesting a persistent upward trajectory in the nation’s real estate wealth.

National home values have experienced a steady climb, rising by 2.3% over the three-month period leading up to October. Although these figures show a slight deceleration from the 3.1% peak in the June quarter, the growth remains significant. Perth, in particular, showcased remarkable growth among the capital city markets with a 4.6% increase, whereas Darwin and Hobart recorded the lowest at just 0.3%.

In terms of property transactions, CoreLogic estimates that there were 40,993 sales nationally in October. This figure, while robust, sits below the five-year historical average for the month, which is typically around 44,813 sales. This dip in volume could speak to various market dynamics including supply constraints or changing buyer sentiment.

Selling property has seen a slight slow down as well, with median days on market ticking up to 30 days for the three months leading to October, indicating a bit more patience is required from sellers. There has been a shift in the negotiation room for vendors as well, with the national median vendor discount tightening to -3.6% from a more generous -4.3% at the end of the previous year.

New listings have been showing an uptick, contributing to the current total of 43,421 across the nation in the four weeks to November 5. These figures are reflective of a seasonal increase, yet they remain -5.4% below the five-year average, indicating a degree of market restraint.

Aggregate listings have witnessed a gradual increase as well, reaching 155,478 listings in the same four-week period, pointedly a 4.2% raise from the previous month. This rise owes much to the more substantial surge in new listings.

Clearance rates in capital cities have managed to hold at a consistent average of 65% in the four weeks to October 29. However, a noticeable drop to 62.9% occurred in the week of the 29th, which may signal shifting market dynamics.

Rental property values continued to trend upward, with an increase of 0.7% in October. This bump contributes to a substantial annual rise of 8.1% nationally, representative of the tight conditions in the rental market.

Dwelling approvals, however, have seen a decline, dropping 4.6% in September and continuing to trend below decade averages for both houses and units. This suggests potential future constraints on supply.

An observable increase in new housing finance was recorded in September, rising by 0.6%, and followed a stronger 2.4% lift witnessed in August. Notably, growth in secured housing finance for investors since February was charted at 16.0%, this compares to a 6.1% growth in owner-occupier lending, reflecting a diverse investment landscape.