National home prices reach new peak in April, but growth momentum slows

National home prices hit a new record in April, driven by strong buyer demand outpacing the rise in new listings, according to the latest PropTrack Home Price Index. However, the pace of price growth is beginning to slow.

Eleanor Creagh, PropTrack Senior Economist, said, “The stable interest rate environment has been a driver of confidence among buyers and sellers. Higher than expected inflation in the March quarter has pushed back the expected timing of rate cuts but most expect that the next move for interest rates will be down although the timing remains uncertain.”

She added that strong population growth, tight rental markets, low unemployment, and home equity gains are stimulating housing demand, while the supply side of the housing market has fallen short in responding to substantial demand, with building activity at decade-low levels.

“Despite some easing in population growth, this mismatch between supply and demand is expected to persist in mitigating the downward effects of affordability challenges and a decelerating economy. As a result, prices are expected to remain on the rise in the months ahead,” Ms Creagh said.

Key findings from the PropTrack Home Price Index for April 2024:

• National home prices rose 0.23% to a new record, now 6.60% above April 2023 levels.
• Combined capital city prices increased 0.21% to a new peak, up 7.19% since April 2023.
• All capitals except Melbourne (-0.10%) and Hobart (-0.24%) saw prices rise in April.
• Perth (+0.83%) and Adelaide (+0.55%) led monthly growth and remain the strongest performing markets.
• Regional areas (+0.30%) outpaced combined capital cities (+0.21%) in April, with regional NSW (+0.50%), WA (+0.33%), and Queensland (+0.30%) leading growth.

Sydney home prices reached a new peak in April, lifting 0.25%, while Brisbane remains one of the strongest performers over the past year, with prices up 12.82% compared to April 2023.

Melbourne home prices fell 0.10% in April but remain 1.10% higher year-on-year, though they are still 3.39% below their March 2022 peak.

Adelaide continues to be a top-performing market, with prices rising 0.55% month-on-month and 13.99% year-on-year, supported by the city’s comparative affordability and low stock levels.

In contrast, Hobart was the weakest capital city market, with prices falling 0.24% in April and now sitting 1.98% below levels seen a year ago.

Perth maintained its streak of outperformance, with prices lifting 0.83% in April and 20.16% higher than April 2023 levels, supported by record-low supply, strong buyer demand, relative affordability, population growth, and tight rental markets.