CoreLogic reports that home prices are continuing to rise in April
The prices of homes in Australia increased rapidly in April, mostly due to increases in prices in the less expensive segments of the market. A constant shortage of housing stock dominated concerns regarding high interest rates and the rising cost of living.
CoreLogic published figures on May 1, which showed that the prices in the US rose by 0.6 percent in April. The increase was similar to the gains that were that were seen in March and February. In 2023, they’ll have already increased by 8.1 percent, bringing them to the previous record high.
In April, the price hikes were caused by the increase by 2 percent in Perth as well as a rise of 1.3 percent in Adelaide. Both cities are cheaper. Sydney prices increased by 0.4 percent and Melbourne’s prices fell by 0.1 percent.
CoreLogic found that nearly all capital cities are seeing stronger growth in the lower price segment of the market.
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The report stated that the steady increase in the cost of housing in spite of a variety of elements that normally act to reduce prices can be traced to a lack of housing stock in relation to the demand.
CoreLogic stated that, despite the fact that the sluggish rising inflation in the nation has triggered concerns about interest rates staying high, the gap between demand and supply will likely keep the value of homes rising. This doesn’t seem likely to change anytime soon.
The Reserve Bank of Australia has raised rates of interest by 425 basis points in order to fight the soaring inflation since the beginning of May 2022. But the tightening of the rate hasn’t been enough to stop the booming of the market for housing.
This could mean that the financial environment isn’t so strict as the RBA would like, since it has kept rates steady at three meeting. Markets are betting on the possibility of another rate hike by September. REUTERS