CoreLogic’s Hedonic Home Value Index for the month of June has revealed a rise in house prices to the tune of 13.5 percent in the 12 months to June 30, as the Australian Institute of Health and Welfare reveals the proportion of social housing households has fallen from 4.6 to 4.2 percent between 2014 and 2020.
Both statistics underline the dire situation home buyers find themselves entrenched within, with the median house price in Sydney now sitting at $994,298, more than eleven times the median income of a worker, after a 15 percent growth in house prices in the harbour city.
Across the country, there were substantial increases in house prices in every capital city. Melbourne saw a 7.7 percent increase, a 13.3 percent rise in Brisbane and a 19.6 percent jump in Hobart. Darwin recorded the highest rise of any capital city, with a staggering 21 percent increase in house values for the 2020/21 financial year.
The rental market is also surging, with national rents for all houses increasing by 15.1 percent and rents for units increasing by 8.1 percent in the past 12 months.
CoreLogic Head of Research for Australia, Eliza Owen, says that the rise in prices has not grown at a rate of this nature for over a decade.
“This is the highest annual rate of growth seen across the Australian residential property market since April 2004, when the early 2000’s housing boom was winding down after a period of exceptional growth. However, there are some markets where performance is starting to ease more notably.”
The decrease in social housing across our municipalities is causing headaches for many Australians, that will be compounded by the projected nine percent surge in homelessness across the country, as well as housing stress forecasted to increase by 24 percent.
Kate Colvin from Everybody’s Home says the trends demonstrate major trouble for many Australians living in housing stress, as well as those currently experiencing or on the brink of homelessness.
“Social housing has historically played an important role providing a safe, secure place to call home to those locked out of the private housing market,” she says.
“As more and more people on low to middle incomes are being left behind by rising rents and house prices, the need for social housing in Australia has never been greater. We need the proportion of social housing to grow, not decline.”
“Homes that ordinary families can afford are critical infrastructure for every community. With a home everybody has the ability to live, work and raise their families. But surging prices and low vacancy rates mean a place to call home is increasingly out of reach for many Australians."
Colvin says the Morrison Government must look to increase social housing for Australians, in an effort to prevent homelessness reaching projected highs.
“We cannot have a situation where house prices rise at close to 10 per cent a quarter in some cases, while social housing declines. That is a recipe for more housing stress, more homelessness and deepening inequality,” she says.
“On the current trajectory, housing stress is only going to worsen for people on low and middle incomes, which is why we need the Federal Government to make an urgent investment in social housing now."
Corelogic’s monthly housing index is available to the general public upon request. To view the report, click here.
Image Credit: Voice Aajkal