Australia’s housing market is now worth almost $10 trillion with more growth on the way

The total value of all Australia’s residential dwellings hit a whopping $9.9 trillion dollars in the December quarter as property prices continued to reach new highs.

That’s half a trillion dollars more than the previous three months, and $2 trillion more than a year ago, according to the latest data on property prices from the Australian Bureau of Statistics.

NSW accounts for around 41% of the national market. Picture: realestate.com.au

We know that’s a lot of money but for the sake of comparison, to spend $9.9 trillion in a year you’d need to spend more than $27 billion a day.

Did you fantasise about what you could have bought if you scored last month’s $120 million dollar Powerball jackpot? Well, you could spend $120 million a day for 200 years and still not spend $9.9 trillion.

By now you get the picture – Australian property is worth a lot of money.

Over the course of 2021 residential property prices increased on average by 23.7%, the strongest annual growth since the ABS began keeping records in 2003.

Of course, just how much property values increased varied from city to city, town to town.

The average Australian property price is creeping ever closer to the $1 million mark, increasing by $44,000 during the quarter to $920,000.

But while the value of property is still on the rise, the growth this quarter is down slightly, indicating an ease in the intense surge in house prices we witnesses during 2021.

PropTrack economist Angus Moore said the pace of price growth looks to have peaked.

“We’re starting to see growth slow but prices are still growing in the early part of 2022,” Mr Moore said.

“That’s consistent with our expectations of this year, we’re expecting prices will continue to grow over 2022 but not at the sort of pace we were seeing last year.”

Here’s what to expect for each state in the months ahead.

• Queensland
• New South Wales
• Victoria
• South Australia
• Western Australia
• Tasmania
• Northern Territory
• Australian Capital Territory

Queensland

Brisbane’s market stands out, because property price increases don’t appear to be easing like they are in most cities.

“Brisbane was the fastest growing market for capital cities in the December quarter,” Mr Moore said.

The city saw property prices increase 9.6% in the December quarter and 27.8% over 2021.

“We expect that [growth] will continue, we think Brisbane will grow faster this year,” Mr Moore said.

“We think 2022 Brisbane will probably out-stretch other capital cities just given the ongoing demand we’re seeing for people to live there.”

Alex Rutherford, lead agent at Place Estate Agents said competition is still extremely competitive – with most buyers competing with 10 to 15 other parties for houses.

“Apartments are now seeing multiple offers, which we haven’t seen for at least 10 years,” Ms Rutherford said.

Ms Rutherford said the city still doesn’t have enough properties to meet demand, and the recent flood crisis had only exacerbated that issue.

“There’s been a number of properties that have had to come out of the market due to having to provide accomodation to family or friends,” Ms Rutherford said.

“Also they might have some water leaks, water through the basement, all through the home.

“So it definitely has created even more of a short supply.”

The average price of a home in Queensland is now $749,100 according to the ABS.

PropTrack forecasts predict dwelling prices in Brisbane will rise between 8% to 11% over the course of the year.

New South Wales

The ABS says the value of all residential dwellings in NSW combined is now more than $4 trillion, that’s approximately 41% of the total value of dwellings in Australia.

That means the average cost of a home in the state is now $1.2 million, easily the most expensive in the country.

While 2021 saw prices increase by a mammoth 26.7% in Sydney, the December quarter’s increase of 4.1% was down again on the previous quarter.

PropTrack predicts annual price growth of between 4% and 7% in Sydney this year.

Victoria

Melbourne’s market held fairly steady in the December quarter, according to the ABS. Values increased 3.9% this quarter, up from 3.6% in the previous quarter.

Melbourne-based buyer’s agent Cate Bakos says the market has stabilised and she anticipates next quarter’s results will reflect that.

“We had close to zero growth in December, and January and February haven’t exhibited runaway growth figures either,” Ms Bakos said.

“When you look at the number of transactions it looks like our vendor supply is probably meeting our buyer demand at the moment.

“I think we can anticipate this changing when we have more international arrivals choosing to buy property.”

The average house price in Victoria is now $956,100.

PropTrack anticipates price growth of 4% to 7% on average across Melbourne, in line with Sydney, and one of the lowest price growth forecasts of all the capital cities.

South Australia

The mean property price in South Australia is now $614,300 after house prices in Adelaide increased 6.8% in the December quarter.

Over the course of 2021 values grew by 23.9%, according to the ABS figures.

Forecasts from PropTrack see price growth of 6% to 9% in Adelaide during 2022.

Western Australia

The average property price in Western Australia is now the same as South Australia according to the ABS.

The value of property in Perth increased in the December quarter (2.9%) by more than it did in the September quarter (2.0%).

However, that pace is anticipated to slow. PropTrack forecasts predict annual price growth of between 3% to 6% this year.

Tasmania

Hobart saw the strongest price growth of all the capital cities over 2021 at 29.8% as a result of low supply of stock for sale, heightened demand and relatively lower prices compared to Sydney and Melbourne.

During the December quarter dwelling prices rose 6.5%, compared to 8.2% in the September quarter.

The average cost of a home in Tasmania is now $649,200.

PropTrack expects that strong growth to continue this year, forecasting price growth of between 9% to 12% – the strongest of any capital city.

Northern Territory

The Northern Territory has the lowest average house price in the country at $489,000.

In Darwin property values rose 1.5% this quarter, and increased by 13.0% over the last twelve months.

Price growth of between 5% and 8% is expected over 2022, according to PropTrack.

ACT

The ACT has the second highest average property price in the country, sitting just below $1 million at $979,600.

In Canberra, values increased by 28.8% over 2021, and 6.4% during the December quarter.

PropTrack forecasts see prices increasing by 6% to 9% over the course of the year.