I have had this on a shelf for some time.
I didn’t really want to release a housing price measurement because if you ask me, we need another one like a hole in one’s head, but I have grown wearisome of the misleading information in the public space.
And given the questions I field on a somewhat regular basis; many don’t seem to realise that the often-regurgitated housing price measures differ in terms of what they measure; their geographic points of reference and the time frames involved.
A couple even portray to be autonomous but are from the same company.
All don’t provide a fuller picture of what is going on.
To that end none provide a measure of the market’s depth – that is the volume and distribution of sales by price group, nor do they compare this demand with supply, i.e., the stock listed for sale.
So, four times a year I will be releasing my own price matrix. This will come out in several ways.
1. Twice a year I will share my headline detached house and attached dwelling findings for the combined capitals. This will come out as a free Matusik Missive post. Usually this will hit your inbox in April. The second public release will be out in November. These releases will cover the year ending March and September respectively.
2. Also, twice a year I will share the same summary findings across 16 major Australian urban regions. These will be released in May and also November each year.
3. Paid subscribers will also have access to a PDF table outlining my findings for all eight capital cities and 16 regional towns.
This post I have also included my forecast for both detached house and attached dwelling prices for the capital cities over the next twelve months.
This forecast assumes that the RBA cash rate starts to fall later this year (more on that topic next week); that the official population growth forecasts continue and that housing supply remains constrained.
So below are my Price Matrices for both detached houses and attached dwellings for the combined capitals.
To get the while story you will need to upgrade your subscription.
So what’s going on?
There has been a big fall in the number of detached house sales under $500,000 across our capitals, down from 25% five year ago to 9% today.
Also there has been a big lift in sales over $1.5 million, up from 6% in 2020 to 20% over the past twelve months.
Over the past 12 months, detached house values have increased by just 3%.
The demand - i.e., sales of detached houses - have eased a bit during the year to March 2024 but overall appear to have stabilised at around 180,000 transactions across the eight capitals per annum.
Detached houses listed for sale has also eased a bit and as a result there hasn't been much change in the average time to sell a house, being 5.4 months at present.
Importantly the March quarter price results suggest that median house prices are falling. This is driven by weaker Melbourne, Canberra, and in some ways, Sydney housing markets. These three capitals have seen more cheaper house sales in the mix and some price reductions at the top end of town. I stress that the March quarter results are preliminary and are based on about half of the typical sale volumes that will eventuate for the three months to March once more homes settle. But I think calendar 2024 will be weaker in terms of price growth than many others are spruiking.
My forecast is that house prices could rise by between 2% and 4% across our capitals as a whole. Some places - as shown in table 2 - could grow much more, some less.
Attached dwelling summary
There has been much less movement in sale volumes by price range for attached dwellings (which are largely apartments) when compared to detached houses.
Over the past 12 months, attached dwelling values have increased by 4%.
Attached dwelling sales have increased over the past twelve months. Last year there were 131,500 sales across our eight capital cities.
Stock listed for sale remain stable and the time taken to sell an apartment has fallen to just 4 months. Interesting this is much faster than a detached house.
The March quarter median price results suggest that attached dwelling prices are falling, but only slightly. This is driven by more cheaper apartments selling, especially one-bedroom stock. Again I stress that the March quarter results are preliminary.
My forecast is that attached dwelling prices could rise by between 3% and 6% across our capitals as a whole. Some places - as shown in table 4 - could grow quite a bit more, some a little less.
My outlook here is stronger than detached houses for the next twelve months because of the lower price points (affordability, but noting that many cannot fit into an apartment or even a typical townhouses) and the high and rising costs to bring new apartment stock onto the market.
When it comes to value it is a ‘cost plus’ world these days.
Behind the paywall are my findings for both detached houses and attached dwelling for each capital city.
To access this PDF and get more housing market intel each week upgrade your subscription today and join the Matusik Missive Plus tribe.