Australian house prices now 19 percent higher than pre-pandemic period

Property prices recorded their strongest quarterly growth on record in the three months to June 2021 

New data has revealed that Australia’s property prices saw their strongest quarterly growth on record in the three months to June, reported 9news.  

The residential property price index from the Australia Bureau of Statistics (ABS) showed that residential property prices increased 6.7 percent for the three months up to June 2021, the strongest quarterly growth since the ABS started the index in September 2003.  

A rise in property values was seen across every capital city, with Canberra (8.2 percent), Sydney (8.1 percent), and Hobart (6.3 percent) taking out the top three. 

Perth and Darwin, which have recorded moderate gains or declines in residential property prices, experienced an upswing at 4.8 percent and 4.6 percent, respectively.  

Michelle Marquardt, head of prices statistics at the ABS, said the market has been driven by low housing supply and a historically low cash rate. 

“The continued growth in property prices was occurring at a time of record low-interest rates. Persistently low levels of stock on the market were being met with strong demand and properties transacting at an increasingly rapid rate,” said Marquardt. 

“With the exception of Hobart and Darwin, capital cities continued to see house price rises outpace those of attached dwellings such as apartments and units, with price growth for both property types being driven by the upper segments of the market.” 

Moreover, this boom in house prices is being detected across Australia.  

Reserve Bank of Australia Governor Philip Lowe said that housing prices are an astonishing 19 percent higher than they were before the pandemic.  

Lowe said the RBA wouldn’t raise interest rates solely to cool down the charging property market.  

“I would like to address the question of housing prices, as some analysts have suggested we might lift the cash rate to cool the property market,” he said.  

More: Sydney median auction price breaks records at $1.92 million amid lockdown

“I want to be clear that this is not on our agenda. 

“While it is true that higher interest rates would, all else equal, see lower housing prices, they would also mean fewer jobs and lower wage growth. 

“This is a poor trade-off in the current circumstances.”