For the first time in four years, all capital cities recorded growth in house prices over the December quarter and an increase in the median house price over the calendar year, according to the latest Australian Property Monitors’ Quarterly Housing Report.
National house prices surged to a new record median of $597,556 following the strongest quarterly rise in four years at +3.7%. Over 2013, the national median house price increased by +9.8% – also the best annual result since 2009.
The Sydney housing market was a star performer throughout 2013 with extraordinary December quarter buyer activity. Achieving the second highest quarterly house price rise on record, Sydney’s median house price increased by an exceptional +6% over the three months to December. Over 2013, Sydney’s house prices rose by +15.1% with the median house price now at a record high of $763,169.
Melbourne house prices increased by +3.2% over the December quarter with the median house price now at a new peak of $568,824. During 2013, Melbourne house prices increased by +8.6% - the second best result behind Sydney.
Perth also recorded a solid year in 2013 with median house prices up by +8.4%. After signs of a plateauing market emerged in the September quarter, price growth resumed at +1.8% in the three months to December.
Dr Andrew Wilson, sneior economis at Australian Property Monitors, sasy the rise is largely due to a combination of "low interest rates, reasonable economic performance and rising confidence".
“All capital city median house prices are now at or close to new records thanks to 2013’s combination of low interest rates, reasonable economic performance and rising confidence,” said Wilson.
“The Sydney market has been supercharged by record levels of investor and changeover buyer activity in the $1 million to $2 million price ranges - particularly in the Upper North Shore and Inner West suburban regions.
“The current level of price growth in Sydney, however, is unsustainable - particularly given the likely continued deterioration of the local economy and the prospect of a flood of new rental properties overshooting underlying market fundamentals."