According to CoreLogic, national home values rose at the fastest rate in March since 1988 – at 2.8 per cent. Brisbane homes climbed 2.4 per cent while regional Queensland rose 2.3 per cent.
Several investors are looking to buy and asked me why prices have gone up so much?
Real Estate Institute of Queensland (REIQ) has advised on some factors:
– Record low interest rates: with the official cash rate set by Australia’s central bank, the Reserve Bank, at 0.1 percent to stimulate the economy during COVID.
– Expats returning home: the data that shows 446,000 Australian ex-pats have returned home between March 2020 and January this year. Property Investment Professionals of Australia (PIPA) agreed, saying the return of cashed-up expats was adding to “sky-high property sales”.
– Interstate migration: The ABS’s September quarter interstate migration figures revealed Queensland showed a net increase of 7,200 people moving to the state from elsewhere within Australia, the highest of any state or territory.
– Government incentives: the Queensland’s Government’s $15,000 First Home Owners Grant. The Federal Government’s HomeBuilder Grant, First Home Loan Deposit Scheme, and the new initiative to assist single parents to purchase a home with just a 2% deposit.
– The keen buyers: CoreLogic’s April home value report says that total national advertised residential listings were extremely low in March. But this wasn’t due to low numbers of homes being put on the market. It was simply because the demand of buyers was outstripping the number of new listings coming online. This has put rising pressure on house prices. This squeeze is also affecting house and unit rents, with CoreLogic finding prices rising in many capital cities – including Brisbane with a 1.1 per cent rise over the year to March.
– The scare factor: CoreLogic Research Director Tim Lawless says the rapid turnover of property has created a sense of FOMO (fear of missing out) among buyers.
REIQ CEO Antonia Mercorella says these factors all combine together to exert their influence on house prices.
Sources: https://www.reiq.com/articles/interest-rates-house-prices/
