The median house price in Sydney increased by around $1,100 a day last year, to more than $1.6 million, according to a new report.
Domain's latest House Price Report, released today, revealed the median cost of houses in Australian capital cities rose to $1.06 million in the December quarter.
In Sydney, it's considerably higher at just over $1.6 million —that's an average increase of $1,100 per day over the course of 2021, or a total rise of $400,000.
According to Domain, the median unit price for a unit in Sydney is just over $800,000, ahead of Melbourne ($593,000) and Brisbane ($416,000).
Domain's chief of research and economics Nicola Powell said people were using their homes differently because of the pandemic.
"We've seen record low interest rates support buyer activity, and we've also seen a high level of household savings," Dr Powell said.
"But I think more importantly, through the pandemic we're spending more time in our homes and using them very differently, and that's driven home owners to upgrade."
It's bad news for aspiring purchasers, who are also contending with sluggish wage growth.
City |
Median house price |
Annual growth |
|---|---|---|
Sydney |
$1,601,467 |
33.1% |
Melbourne |
$1,101,612 |
18.6% |
Brisbane |
$792,065 |
25.7% |
Adelaide |
$731,547 |
27.5% |
Canberra |
$1,178,364 |
36.6% |
Perth |
$752,110 |
7.5% |
Hobart |
$752,110 |
34.6% |
Darwin |
$645,487 |
25.2% |
Despite units in Sydney also experiencing considerable growth of 8.3 per cent, the gap between unit and housing affordability is at a record high.
"House prices in Sydney have grown four times faster than units, and this is something we've seen across most of our capital city markets," Dr Powell said.
The good news for buyers is that the NSW market could finally be losing some of its relentless momentum.
CoreLogic data indicates that Sydney's monthly growth rate is reducing, and the market may peak in 2022.
An increase in housing stock across the city is likely to take steam out of demand, and a potential interest rate hike could slow growth.
"Buyers now have more choice and it means that sellers need to be a little more realistic on pricing," Dr Powell said.
Regional house prices are also at record highs.
During the last quarter, regional prices outperformed that of the combined capital cities for the first time since the end of 2020.
In NSW, coastal towns, especially in the north, are experiencing some of the strongest growth.
"It's been those lifestyle areas that have seen the strongest ... the ability to work from home has really changed where we can reside," Dr Powell said.
At $1.7 million, the median house price in Byron Bay is higher than Sydney, and nearly 50 per cent more than what it was a year ago.
Earlier this month, AMP chief economist Shane Oliver said house prices in Australia were expected to begin to fall later this year and into 2023.
"It's unclear what impact the latest COVID wave, driven by the Omicron variant, will have on the property market. It will likely reduce buyer confidence, but it could also dampen listings," he said.
