Australia’s home prices hit record high -CoreLogic
9:03 am Wednesday, November 22nd, 2023
SYDNEY (Reuters) – Australian home prices have defied a substantial jump in interest rates to hit a record high, data from property consultancy CoreLogic showed on Thursday, a sign that monetary policy might not be restrictive enough.
Since finding a floor in January, home prices have risen 8.1% as of Nov. 22, more than offsetting a 7.5% fall that commenced after the Reserve Bank of Australia started tightening monetary policy in May last year, according to CoreLogic.
It took around nine months for prices to move from record highs to the recent trough, then roughly 10 months to recover from the downturn.
Across the capital cities, Perth, Adelaide and Brisbane were all at record highs, while Sydney and Melbourne were still 1.8% and 3.6% lower respectively than the previous peaks in March last year.
The resilience in the property market is one of the reasons that the RBA resumed raising interest rates to a 12-year high of 4.35% this month after four months of steady outcomes.
The RBA expects the additional wealth from rebounding property prices to provide support in consumption.
Markets are pricing only a 5% chance it will hike again in December, but imply around a 40% risk it might move once more in the new year.
(Reporting by Stella Qiu; Editing by Sam Holmes)
