Melbourne home values have continued to make a “remarkable recovery” in November.
A 1.9 per cent combined house and unit value rise for the month is expected to be announced by property data firm CoreLogic when its figures are finalised on Monday.
Values have now risen six months in a row, according to the firm’s Hedonic Home Values Index, with more than a 4 per cent jump in the past two months alone. The city’s median is even on track to reach a new record high by January.
A massive 2.3 per cent increase in October was the largest month-on-month value gain since November 2009, taking Melbourne’s median dwelling value to $650,197.
CoreLogic’s head of research Tim Lawless said this November was another “very strong” result for Victoria’s capital.
“It’s quite a remarkable recovery we’ve seen in Melbourne … it’s great news for homeowners who already have a foot in the door and are now getting wealthier,” Mr Lawless said.
“It’s the combined effects of limited access to credit, affordability created by the downturn and a shortage in the number of advertised properties clashing with the demand.”
Melbourne’s total stock pool was about 16 per cent smaller than the same time last year, he added.
While record values could be reached as early as next month, the speedy recovery may slow down in the new year.
“I’d be surprised if this pace of growth can be sustained,” Mr Lawless said.
“Household incomes aren’t rising very quickly at all and housing affordability is starting to deteriorate, which means a larger portion of buyers can’t participate.”
Full Circle Property Advocates director Rob German said many buyers were desperate to break into the market before more price rises.
“I think there’s some anxiety out there from buyers who are saying that the market is only going north now, so they want to go hard and secure something,” Mr German said.
“With interest rates so low, buyers are willing to compete really aggressively and go to their maximum loan capacity, because it’s not going to cost them so much to do so right now.”
Some unprecedented results have been notched across Melbourne recently, with properties selling for premium prices.
A predicted 1.8 per cent value rise for Australia’s five major capitals together in November will be the strongest month-on-month gain since 2015. Perth is also expected to notch its first value rise this month since early 2018.