CoreLogic's latest findings show a trend of growing capital gains which are being felt at the auction sites, according to Nick Lennan of McGrath Coogee.
When Nick Lennan of McGrath Coogee listed 404C/8 Loveridge St, Alexandria for auction, he knew it would be sold on the day.
The one bedroom, one bathroom unit in an older, but well-kept building with a lovely communal garden had so much interest on its open days that Mr Lennan advised prospective buyers they may be looking at a $650,000-$700,000 price tag.
"We had sold another unit in Alexandria in November 2019 for $682,500," said Mr Lennan.
"It is actually larger with an area suitable for a larger dining table and has newer finishes."
On auction day there were 35 registered bidders, but it only took three bids for the unit to sell $135,000 above the reserve price of $700,000.
The new owner was a first home buyer, currently living with his parents and keen to get into the market.
At a Glance:
This example aligns with CoreLogic's findings that a rebound in the pace of capital gains across the Australian housing market throughout February saw the national index rise
by 1.1 per cent over the month.
The strongest capital gains continue to emanate from Sydney (+1.7 per cent) and Melbourne (+1.2 per cent), while the remaining capital cities recorded a more modest rise, with Darwin the exception where home values were down 1.4 per cent over the month.
On an annual basis, both Sydney and Melbourne moved back into double-digit annual growth rates, with values up 10.9 per cent and 10.7 per cent respectively over the twelve months ending February.
Source: CoreLogic
According to CoreLogic head of research Tim Lawless at the current run rate of growth, the national index is likely to reach a new nominal high over the next two months.
"Melbourne was the most recent city to stage a nominal recovery with housing values surpassing the September 2017 peak last month," said Mr Lawless.
"Melbourne has joined with Brisbane, Canberra, Hobart and Adelaide where housing values are also tracking at record highs.
"Despite posting the most rapid recovery trend amongst the capitals, Sydney housing values remain 3.7 per cent below the 2017 peak; based on the rate of growth over the past three months, Sydney housing values could stage a nominal recovery by the end of May this year."
Further evidence that the long-running downturn is over for the Perth housing market was revealed, with dwelling values increasing by 0.3 per cent in February, marking four consecutive months where dwelling values have avoided a fall; a trend not seen since the market peaked in mid-2014.
“Although Perth values are now trending higher, the recovery period is likely to be a long one, with Perth housing values remaining 21.0 per cent below their peak," said Mr Lawless.
"Regional markets are generally lagging behind the capital cities, with housing values only 1.4 per cent higher over the past twelve months compared with a 7.3 per cent rise across the combined capital city markets.
“The diversity across regional Australia is extreme, with drought affected areas impacting the regional index.
"Meanwhile, the regional centres adjacent to the largest capitals, as well as coastal lifestyle markets, show a stronger performance."
Read John McGrath's column First Home Buying soars
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