At the end of every financial year, we look back at the year that was in property prices. Here is our look back at FY21. Despite the uncertainty of the pandemic, the growth of Australia’s property market continued unabated.
Australia’s housing market jumped by 1.9% in June 2021, taking annual growth for the last financial year to 13.5% on an annualised basis.
According to property data and analytics company CoreLogic, this is the highest annual rate of growth seen across the Australian residential property market since April 2004, when the early 2000s housing boom was at its peak.
The growth was driven by a rise in house values, which increased by 15.6% over the year, compared to a 6.8% lift in unit values.
Of the capital cities, Darwin experienced the greatest surge in dwelling values, rising by 21% in the year.
This was followed by Hobart (19.6%), Canberra (18.1%) and Sydney (15.0%).
Sydney continues to have the highest median value of the capital cities, with its figure for the year ending FY21 coming in at $994,292.
Sydney’s market defied early pandemic warnings of steep falls, as low interest rates and government stimulus triggered a buying frenzy.
Meanwhile, Brisbane and Adelaide were at similar growth rates – at 13.2% and 13.9% growth, respectively – over the year.
Perth experienced the smallest increase in dwelling values over the financial year, rising by 9.8 per cent, with Melbourne coming marginally ahead (10.7%).
The rate of growth is slowing
An important trend, however, is the slowing of growth rates.
Hobart continued its strong streak, with 3.0% growth in the last month of the fiscal year, as did Sydney (2.6%) and Canberra (2.3%), but Brisbane and Adelaide recorded more subdued monthly price growth of 1.9% and 1.6%.
CoreLogic said that the loss of momentum can be seen most clearly in markets like Darwin and Perth, where values grew by just 0.8 of a percentage point and 0.2 of a percentage point.
Cooling was also apparent in Melbourne where home prices rose 1.5%, which was weaker than the 1.8% growth in May.
A great time to buy and invest
The present time remains a good one to both invest and to buy property in Australia.
Interest rates remain at record lows and are likely to for some time, and government incentives and stimulus has seen more people more interested than ever in becoming homeowners. This is reflected in what we at MCCA have seen over the same period, with people continually showing interest in home ownership through our popular home finance products.
The underlying fundamentals of the property market remain as robust as ever, meaning that the saying “as safe as houses” applies now more than ever in a world that is pandemic-affected. This is why we’ve seen strong interest in both the MCCA Property Fund and MCCA Income Fund.
Whether you are looking to buy or invest in property, speak to us to see how we can support your objectives.
