Brisbane home values grew at twice national pace despite units dragging down gains

BRISBANE home values grew at twice the national pace in November despite units being a major drag on overall gains, latest figures show.

Across the combined capital cities there was a 0.2 per cent rise over the month, the latest CoreLogic Hedonic Home Value Index found, while Brisbane grew at 0.4 per cent.

Brisbane saw year-on-year growth of 3.9 per cent, with the quarter to November showing a 1.3 per cent rise, with higher unit supply weighing down capital gains, according to CoreLogic research head Tim Lawless.

“Brisbane house values were up 4.3 per cent over the past twelve months compared with a 0.9 per cent fall in unit values,” he said.

“With the unit supply pipeline remaining substantial, we expect to see a continuation of weaker market conditions across those unit markets where high supply levels are dampening the prospects for higher value growth.”

A substantial unit supply pipeline was expected to weigh on future home value growth in Brisbane as well as Melbourne.

The national housing growth cycle now sitting at over 4.5 years in length, Mr Lawless said.

During that time, capital city dwelling values had risen by 42.2 per cent, something that experts believed was a hard pace to sustain.

“Affordability constraints are creating high barriers to entry, particularly in Sydney, and lenders are becoming more cautious in their lending practices. The supply pipeline is substantial for inner city units, which is likely to dampen value growth in these precincts as well as dent buyer confidence and push vacancy rates higher,” he said.

“Additionally, buyer enthusiasm could be muffled by speculation that interest rates may rise late next year, with fixed rates already starting to edge higher.”

Home Values Index results for Brisbane region:

Median dwelling price: $485,000

November performance: 0.4 per cent

Three months to Nov: 1.3 per cent

Year-on-year: 3.9 per cent

[Source:- Realestate]