So, what’s going on? Let’s take a closer look at the figures
You may be wondering how long it will take for your home to double in value so let’s take a look at what’s been happening across the country and what you might be able to expect.
Director of Economic Research at the REA Group, Cameron Kusher, says: “Ever since I began working in the property sector, people have mentioned the adage that property prices double every seven to ten years. Despite the strong price growth through the pandemic, this hasn’t been the case lately.”
The stats from May 2023 show the median house price nationally was $730,000 and the median unit price was $560,000. We also see median house prices took 15.4 years to double, while median unit prices took 17.8 years to double.
So, what’s going on? Let’s take a closer look at the figures:
Prop Track Time for median prices to double, May 2023: Houses | ||||
---|---|---|---|---|
Region | Current median | Previous median | Months to double | Years to double |
Sydney | $1,308,000 | $648,000 | 115 | 9.6 |
Melbourne | $880,000 | $437,000 | 157 | 13.1 |
Brisbane | $755,000 | $372,000 | 187 | 15.6 |
Adelaide | $670,000 | $335,000 | 181 | 15.1 |
Perth | $563,000 | $280,000 | 214 | 17.8 |
Hobart | $720,000 | $360,000 | 82 | 6.8 |
Darwin | $585,000 | $289,000 | 200 | 16.7 |
ACT | $950,000 | $475,000 | 157 | 13.1 |
Capital cities | $825,000 | $412,000 | 172 | 14.3 |
Rest of NSW | $720,000 | $360,000 | 113 | 9.4 |
Rest of VIC | $587,000 | $291,500 | 115 | 9.6 |
Rest of QLD | $550,000 | $275,000 | 213 | 17.8 |
Rest of SA | $350,000 | $175,000 | 206 | 17.2 |
Rest of WA | $435,000 | $215,000 | 210 | 17.5 |
Rest of TAS | $530,000 | $265,000 | 70 | 5.8 |
Rest of NT | $475,000 | $235,000 | 195 | 16.3 |
Regional areas | $582,500 | $290,000 | 192 | 16.0 |
National | $730,000 | $365,000 | 185 | 15.4 |
Prop Track Time for median prices to double, May 2023: Units | ||||
---|---|---|---|---|
Region | Current median | Previous median | Months to double | Years to double |
Sydney | $749,999 | $374,000 | 207 | 17.3 |
Melbourne | $600,000 | $300,000 | 198 | 16.5 |
Brisbane | $473,000 | $235,000 | 227 | 18.9 |
Adelaide | $432,000 | $215,000 | 201 | 16.8 |
Perth | $395,000 | $197,000 | 230 | 19.2 |
Hobart | $545,000 | $272,500 | 94 | 7.8 |
Darwin | $380,500 | $190,000 | 211 | 17.6 |
ACT | $585,000 | $290,000 | 227 | 18.9 |
Capital cities | $580,000 | $290,000 | 217 | 18.1 |
Rest of NSW | $580,000 | $290,000 | 157 | 13.1 |
Rest of VIC | $412,500 | $206,000 | 165 | 13.8 |
Rest of QLD | $530,000 | $265,000 | 219 | 18.3 |
Rest of SA | $300,000 | $150,000 | 215 | 17.9 |
Rest of WA | $319,000 | $158,000 | 223 | 18.6 |
Rest of TAS | $400,000 | $200,000 | 174 | 14.5 |
Rest of NT | $353,000 | $175,000 | 213 | 17.8 |
Regional areas | $510,000 | $255,000 | 210 | 17.5 |
National | $560,000 | $280,000 | 213 | 17.8 |
We can see that median house prices across the capital cities doubled quicker (14.3 years) than they did across regional markets (16 years). While for units it was a different story with regional prices doubling quicker (17.5 years) than those in capital cities (18.1 years).
The only markets in which median house prices doubled in less than a decade were regional Tasmania (5.8 years), Hobart (6.8 years), regional NSW (9.4 years), regional Victoria (9.6 years) and Sydney (9.6 years).
Hobart was the only market in which unit prices doubled in less than a decade, taking 7.8 years, while prices doubled relatively quickly in regional NSW (13.1 years) and regional Victoria (13.8 years).
We also see that across every capital city and regional area, median house prices have doubled over a shorter period of time than median unit prices have. This highlights that houses tend to appreciate in price quicker than units.
Prices have generally taken longer than a decade to double, despite very strong rises across most of the country through the pandemic – and that is a trend we expect to continue over the coming years.
The key drivers of strong price growth over recent decades were primarily falling interest rates, increasing household incomes (as more women joined the workforce), easier and greater access to finance, and migration creating strong demand for housing.
While there is little sign of the strong migration of the past decade abating, interest rates are unlikely to fall like they have over recent decades. Additionally, employment participation is unlikely to increase as much, and accessing a mortgage is more difficult than it has been in the past.
It looks like the days of property prices doubling every seven to ten years may be well and truly in the past.
This article was originally published on realestate.com.au ‘Australian home prices have taken 15 years to double; prices in Tasmania doubled fastest’