Australia home prices rise in Oct to snap five-month losing streak

[SYDNEY] Australian home prices edged higher in October to break a five-month losing streak amid record-low interest rates and limited stock, even as a coronavirus lockdown in Victoria state hamstrung the major Melbourne market.

Data from property consultant CoreLogic out on Monday showed national home prices rose 0.4 per cent in October, the first increase since April when a country-wide lockdown hammered the market.

Prices were up 3.9 per cent on October last year, with regional housing in demand as some seek to leave the cities. Values across the major capitals firmed 0.2 per cent in October, while regional prices climbed 0.9 per cent.

Sydney eked out a gain of just 0.1 per cent and Melbourne dipped 0.2 per cent, while cities that had been largely Covid-free for some time powered ahead. Prices rose 1.2 per cent in Adelaide and Darwin, and 1 per cent in Hobart and Canberra.

With Melbourne's long lockdown now also easing, listings and auctions in the city were surging.

"Based on this recent trend in housing values and activity, it seems likely we will see Melbourne follow the other capital cities towards a recovery over the coming month," said CoreLogic's head of research Tim Lawless.

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He noted that despite the jump in listings, the total stock of national housing up for sale was still near all-time lows.

"Persistently low total stock levels in the face of surging new listing numbers point to a strong rate of absorption, as buyer demand exceeds advertised supply levels," said Mr Lawless.

Australia's housing stock was valued at A$7.2 trillion (S$6.90 trillion) in September even after a nation-wide lockdown tipped the economy into its first recession in 30 years.

The Reserve Bank of Australia has indirectly supported residential demand by lowering borrowing costs to record lows and is widely expected to cut its cash rate to just 0.1 per cent at a policy meeting on Tuesday.

REUTERS