The boom is cracking along, but Canberra’s not touching it.
So the current property boom continues to set a cracking pace.
Is there any change the government might step-in and try and throw cold water on it all?
So we had a couple of data points on the property market last week. And they’re both bullish.
First up is Domain’s price data for the March quarter. It’s points to the strongest growth in 18 years, as cities across the country get a full head of steam going.
At the national level, house prices rose 5.7% to just under $900,000, with annual gains also hitting double digits (10.0%).
Sydney led the way recording a quarterly gain of 8.5%, representing a whopping $103,000 increase in its median house price. It was also the fastest quarterly rise in house prices since Domain records began in 1993.
Massive price growth was also recorded across the smaller capitals – Hobart (7.6%), Canberra (9.7%) and Darwin (9.1%) – over the March quarter.
Melbourne’s median house price hit $974,397 in the March quarter after recording a $45,000 (4.8%) increase, with Domain tipping it will crack $1 million over the June quarter.
Boom. Boom. Boom.
At the same time, Corelogic released data for the month of April.
Capital cities surged another 1.8% in the month, which is slightly less than the 2.8% posted in March, although to be fair, that was the biggest monthly increase in 33 years.
The rise in values was once again broad-based with all major markets experiencing strong rises. Sydney’s gain was once again the strongest, surging by 2.4%:
Sydney continues to lead price growth, but all major capitals recorded strong rises in April.
And this is just the capital city story. One of the interesting features of the current boom is that the regions are keeping up, and in recent months, have matched the capitals gain for gain.
When you look at the annual growth rates, you can see that growth is clearly accelerating, and showing no signs of slowing down yet.
So the boom is well and truly cracking. On current form, Sydney prices will end the calendar year up 25%!
So is there any chance the government might get involved and try and cool the market down, like they did in 2016.
Nup. Doesn’t look like it.
Australian Prudential Regulatory Authority (APRA) chairman, Wayne Byers, has hosed down speculation that the regulator might do anything to take any heat out of the market.
“Risk for the financial system occurs when lending standards are poor or weak,” Mr Byres told a Committee for the Economic Development of Australia event.
“We don’t see that up to now – banks have done a pretty good job in holding lending standards up.”
The APRA chief also said that regulatory settings were “broadly right”, given that the agency’s mandate was broader than stability of the financial system at all costs.
Nope, let the boom roll.
That’s the word from the top.