$848,858: Home prices hit new high leading into spring

Spring has officially sprung and it appears that temperatures aren't the only thing on the rise.

The latest data from research firms Cotality and PropTrack shows that property price growth accelerated during August, just as buyers and sellers are gearing up for the busy spring property season.

National home values rose by 0.7% in August according to Cotality - the largest month-on-month increase since May 2024. Over the last 12 months home values have risen 4.1%.

Meanwhile, PropTrack found that national home values rose by 0.5% over the course of August and are 4.9% higher than they were 12 months ago.

Tim Lawless, Cotality Australia research director, says that the recent growth has been driven by a combination of increased buyer confidence spurred on by falling interest rates and ongoing supply constraints.

"Once again we are seeing a clear mismatch between available supply and demonstrated demand placing upwards pressure on housing values."

Capital city prices expected to keep rising

Unsurprisingly, given the consistent growth trend in recent months, the median home value in Australia has reached yet another record high according to both Cotality ($848,858) and PropTrack ($835,000).

It's been more of a mixed bag for price growth across the capital cities.

Brisbane, Darwin and Perth were among the standout markets for growth during August, while Hobart was the only capital to record a decline in home values.

Darwin has been the real frontrunner over the last 12 months though. The city is now the only capital with a double-digit annual growth rate.

Going forward, Eleanor Creagh, senior economist at REA Group (owner of PropTrack) expects that prices will continue to tick upwards.

"The combination of lower interest rates, increased borrowing capacities and improved sentiment is expected to continue to drive demand," she says.

"Constrained new housing supply, strong population growth and the expansion of the Home Guarantee Scheme from October will also maintain upward pressure on prices.

"As we enter spring, the housing market appears poised for another leg higher, albeit strengthening in some capitals while normalising in others."

Are buyers or sellers in the box seat this spring?

Heading into one of the busiest times of the year for property transactions, Lawless notes that relatively low stock levels and high clearance rates indicate that sellers are entering spring in a strong position.

Across the combined capitals, Cotality recorded a final clearance rate of 70% over the weekend of August 30 and 31 - the highest rate since February 2024.

However, buyers are likely to see more options crop up in the weeks to come as the spring season kicks into gear and more homes are put up for sale.

"We are starting to see the usual start of spring upswing in new listings coming to market, but from a low base," says Lawless.

"A pick up in the flow of stock coming to market through spring will be good news for buyers who generally have limited choice at the moment."

Interestingly, the latest Residential Property Index from NAB suggests that there is a degree of confidence among some home buyers heading into spring.

The index, which measures housing market sentiment, has reached its highest level in the past year, with NAB noting that buyers in the ACT and Victoria are particularly optimistic at present.

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