Australian house values have climbed despite the coronavirus recession with regional areas set for very strong growth in 2021 as more people work from home.
The worst economic downturn since the 1930s Great Depression failed to dent property values, on an annual basis, with national median prices climbing by three per cent last year, Core Logic data showed.
This was despite Sydney prices dropping for five straight months as Melbourne house values declined for six months in a row.
Australian house values have climbed despite the coronavirus recession with regional areas set for very strong growth in 2021 as more people work from home. Covid restrictions in Australia’s biggest cities (Sydney’s Pitt Street Mall pictured on Boxing Day) meant capital city prices increased by just two per cent last year
Covid restrictions in Australia’s biggest cities meant capital city prices increased by just two per cent last year, with values increasing in every major city in December.
The story was very different in regional areas, with median values surging in 2020 by 6.9 per cent.
CoreLogic head of research Tim Lawless said the ability of professionals to work from home meant coastal regional areas boomed last year, despite not being particularly popular before the pandemic.
‘As remote working opportunities became more prevalent and demand for lifestyle properties and lower density housing options became more popular, regional areas of Australia saw housing market conditions surge,’ he said.
‘Regional housing markets had generally under performed relative to the capital city regions over the past decade, but 2020 saw regional housing values surge as demand outweighed supply.’
Simon Pressley, the head of research with buyers’ agent Propertyology, said 40 regional areas were set to significantly outperform capital city markets in 2021.
The story was very different in regional areas, with median values surging in 2020 by 6.9 per cent. CoreLogic head of research Tim Lawless said the ability of professionals to work from home meant coastal regional areas boomed last year, despite not being particularly popular before the pandemic. Pictured is Sunshine Beach near Noosa
‘Many locations are strong candidates for more than 20 percent capital growth,’ he told Daily Mail Australia.
Ballina on the far north coast of New South Wales, Noosa on Queensland’s Sunshine Coast, Launceston in northern Tasmania, Bendigo in western Victoria, Busselton in southern Western Australia and Mount Gambier in western South Australia were expected to thrive this year.
Mr Pressley expected Melbourne prices to grow by five per cent in 2021, making it Australia’s worst-performing capital city market, as Sydney and Darwin values increased by five to ten per cent.
Brisbane’s equivalent median price was expected to rise by 10 to 15 per cent as Perth, Adelaide, Canberra and Hobart values rose by 15 per cent.
In 2020, the Reserve Bank of Australia cut interest rates to a new record-low of 0.1 per cent and three of the big four banks offered fixed-interest mortgage rates of less than two per cent.
Mr Lawless said house price rises last year were testament to home buyers having confidence in the government’s Covid response.
‘Record low interest rates played a key role in supporting housing market activity, along with a spectacular rise in consumer confidence as COVID related restrictions were lifted and forecasts for economic conditions turned out to be overly pessimistic,’ he said.
‘Containing the spread of the virus has been critical to Australia’s economic and housing market resilience.’
Simon Pressley, the head of research with buyers’ agent Propertyology, said 40 regional areas were set to significantly outperform capital city markets in 2021 including Ballina (pictured) on the far north coast of New South Wales
After a bad year, Melbourne ended 2020 as Australia’s best performing state capital city property market with median house prices in December climbing by 1.2 per cent to $799,980.
Brisbane’s median house price also went up by 1.2 per cent last month, ending 2020 at $576,338.
Adelaide also increased by 1.2 per cent with a mid-point house price of $504,829.
Sydney continued to be Australia’s most expensive property market with median house prices up 1.1 per cent to $1,015,354.
Source: Daily Mail
