Inner Melbourne property leads national price surge after interest rate cut
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Inner Melbourne has recorded the strongest property price growth in Australia following the Reserve Bank’s February interest rate reduction, with unit prices jumping 5.9 per cent over three months.
House prices in the same region increased by 3.6 per cent, making inner Melbourne the top performer for both housing categories nationwide according to PropTrack data.
“Home prices have underperformed the rest of the country so much and are now cheaper than Brisbane, Adelaide and on track to be cheaper than Perth,” REA Group senior economist Anne Flaherty said.
This marks a significant reversal for Melbourne’s previously stagnant market, with buyer sentiment improving dramatically.
The latest Westpac-Melbourne Institute Index of House Price Expectations showed Victorian consumers recorded a 14 per cent rise in price expectations, according to Westpac head of Australian macro-forecasting Matthew Hassan.
Real estate agents report increased buyer activity following February’s interest rate cut, with investors returning to the market after a period of absence.
“Last year the investors were getting out of the market, but now with interest rates dropping we are noticing they are re-entering the market, particularly with units,” said Andrew Crotty, director at BigginScott Richmond.
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Darwin emerged as the second-strongest market for house price growth at 3.29 per cent over three months, followed by Gold Coast at 2.97 per cent.
Regional areas continue to record the strongest annual growth figures, with Townsville topping the list at 21.86 per cent for houses and 23.58 per cent for units compared to a year ago.
Ms Flaherty noted that while Townsville has been “an investor hotspot over the past 12 months,” the rate of growth there has slowed recently as investor attention shifts to other markets.
Six of the top ten regions for annual house price growth are in Queensland, highlighting the state’s continued strong performance in the property market.