Australian housing market starts new year strong

Australia’s housing market is off to a strong start, with buyer demand increasing in January, according to REA Group’s PropTrack Housing Market Indicators Report for February.

Demand based on views per listing on realestate.com.au jumped 48.2% month-on-month to reach a historic high, which was 41.9% higher than this time last year.

Demand was also strong across the country, with historic high views per listing in all states except Victoria. Brisbane posted the largest year-on-year increase at 81.5%, followed by Adelaide (70.1%), regional SA (92.4%) and regional NSW (68%). Regionally, each respective state except the NT have seen views per listing surge more than 35% year-on-year.

“The Omicron variant remains a distraction, but so far, the housing market is off to a strong start,” said Eleanor Creagh, PropTrack senior economist and report author. “We’re kicking off the year with many active buyers, although a surge in new listings into the end of 2021 has provided a lot more choice, releasing some of the heat from the market. Indicators of buyer demand show property seekers remain motivated, but a more sustainable balance between buyers and sellers is expected in the year ahead.”

Creagh is expecting last year’s surge in prices will continue to ease given the benefits of lower mortgage rates have already been converted into higher prices.

“As the tailwind from low interest rates is diminished, alongside more choice and less competition, price growth will moderate,” Creagh said. “Demand is likely to continue easing from peak levels as new listings are likely to remain elevated, with would-be sellers responding to the strong price growth witnessed last year.”