Australian house prices are growing at their fastest annual pace since 1989, although there are further signs the boom is coming off the boil.
CoreLogic’s national home value index rose 1.5% in August to an annual rate of 18.4%.
While the monthly increase was still above average, it was the smallest rise since January.
CoreLogic’s research director Tim Lawless said the slowing rate of price growth probably had more to do with worsening affordability constraints than ongoing Covid-19 lockdowns.
“Housing prices have risen almost 11 times faster than wages growth over the past year, creating a more significant barrier to entry for those who don’t yet own a home,” Mr Lawless said.
Annual wage growth is currently running at just 1.7%.
“Lockdowns are having a clear impact on consumer sentiment, however, to date the restrictions have resulted in falling advertised listings and, to a lesser extent, fewer home sales, with less impact on price growth momentum,” he said.
He said an ongoing shortage of properties available for purchase was likely central to upward pressure on housing values.
Housing values rose in every capital city in August, apart from Darwin, where they declined 0.1%.
CoreLogic also withheld its index results for Perth and regional Western Australia “pending the resolution of a divergence from other housing market measurements in WA”.
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Meanwhile, the annual increase of 18.4% in national house prices in August equates to a rise of about $103,400 or $1990 per week.
This is the fastest annual pace of growth in housing values since the year ending July 1989.
“Through the late 1980s, the annual pace of national home value appreciation was as high as 31%, so the market isn’t quite in unprecedented territory,” Mr Lawless said.