Sydney and Melbourne lead house price surge in March

Australian property prices continued their surge higher in March despite the threat of rising interest rates and recent rampant appreciation. Preliminary numbers from CoreLogic show an approximate 1.4 per cent advance in capital city dwelling values in the month, suggesting the housing affordability debate could step up a notch when the final numbers are released on Monday.

Again the strongest results were found in the largest markets of Sydney and Melbourne, with prices in the two cities swelling at their quickest rate in the current up cycle. “The preliminary data suggests that annual growth in Sydney dwelling values will be around 19 per cent by month’s end, while growth in Melbourne is approaching 16 per cent per annum, both of which are higher than the previous cyclical peaks throughout the current growth phase,” CoreLogic head of research Asia Pacific Tim Lawless said.

A flurry of out-of-cycle rate rises from the big four banks have been announced since mid-March, but low stock levels are currently offsetting the impact of higher rates. “The strong capital gain results are further evidenced by a continuation in low stock levels, high auction clearance rates and strong investment demand,” Mr Lawless said.

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