Australia’s house prices rose 22% during 2021 lockdowns

SYDNEY, 4 Jan 2022:

The price of homes in Australia increased by 22.1% in 2021, the largest increase since the late 1980s, due to low interest rates and a strong demand, according to a study published today.

“In the final months of 2021, home values ​​posted the highest annual growth rate since the late 1980s, at a time household wages and incomes were barely moving,” the study from consulting firm CoreLogic read.

Only in December of last year, housing prices – whose average is A$709,803 – increased by 1% at the national level; although the increase was greatest in the Australian outback areas, where property values ​​rose 2.2%.

In contrast, since October 2020, price momentum had slowed in the real estate markets of Sydney and Melbourne, Australia’s most populous cities and where growth of 0.3% respectively and a 0.1% drop were recorded last month, according to the report.

The reasons for this slowdown in those two coastal cities are attributed to obstacles buyers face to make deposits, low revenue growth and an increase in supply.

Other causes mentioned by the Australian consultancy are weak demographic trends, in a context in which the country stopped receiving immigrants due to the closure of its borders during the pandemic.

“With the reopening of international borders, rental demand is likely to be the main beneficiary, rather than house purchase demand, especially in the inner-city rental districts popular with students and foreigners,” according to the statement from CoreLogic.

– EFE