Australia’s House Prices Jump the Most in Almost Two and Half Years

(Bloomberg) -- Australian housing prices rose the most in almost 2 1/2-years in August, as the recovery in the property market takes hold.

• Housing values increased 0.8% last month, the biggest gain since April 2017, CoreLogic Inc. data released Monday showed.

Key Insights

• While property prices in Sydney and Melbourne started emerging from a two-year slump in June, the rebound is spreading, with nationwide prices rising for the first time since October 2017.
• The nation’s two biggest cities are still leading the way: Sydney house prices jumped 1.6% last month, while Melbourne climbed 1.4%. It’s not all one-way traffic -- home values are still falling in Perth, the capital of mining state Western Australia, and the outback outpost of Darwin.
• Four factors have reignited the property market: interest rate and tax cuts, an easing in bank-lending rules, and the surprise re-election of Scott Morrison’s government, which killed off plans by the opposition Labor party to unwind tax breaks for landlords.
• Sentiment has risen so sharply, that CoreLogic research director Tim Lawless now says the rebound could potentially turn into a ‘V-shaped’ recovery. Just last month, he said there was “no sign” such a rapid turnaround could emerge.
• Much will now depend on the peak Spring selling season, as more supply hits the market. “As stock levels continue to rise throughout Spring, we will get a much better understanding of the depth of the current recovery,” Lawless said.

Read More

• All of a Sudden, Australia’s Housing Market Is Heating Up Again
• Australia’s Soggy House Market Boosted as Lending Rules Eased

To contact the reporter on this story: Peter Vercoe in Sydney at pvercoe@bloomberg.net

To contact the editors responsible for this story: Katrina Nicholas at knicholas2@bloomberg.net, Edward Johnson

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