Home Property Australia Record gaps between house and unit prices

Record gaps between house and unit prices

  • February 02, 2015

Record gaps between house and unit pricesThe price gap between Sydney dwellings and those in other capitals has widened, as has that between houses and units, according to the latest market-data analysis from CoreLogic RP Data. According to CoreLogicresearch director TimLawless’ analysis, house prices rose at a faster rate than apartment prices over the December quarter, and the gap between median selling prices of capital city houses and units has never been wider. As at December 2014 capital-city median house prices were almost 20 per cent higher than those of city units – around $100,000 in dollar-value terms.Lawless says the percentage difference between house and unit prices is at an unprecedented high in Sydney ($243,000), Melbourne ($170,000) and Canberra ($172,000) and at near-record highs in Brisbane ($102,000) and Perth ($110,000). “We are seeing record-high dwelling commencements for units in particular, in Sydney, Melbourne and Brisbane,” Lawless explains. “Growing demand for unit stock, from investors and owner-occupiers, and the sheer affordability difference between house and unit prices at least partly explains this.”There was substantial cost variance in actual selling prices across capital cities: the median price of Sydney houses was $858,000; of apartments, $615,000 – which, Lawless notes, makes the Sydney apartment median price greater than those for houses across all other capitals except Melbourne ($660,000). Sydney house prices command a 30 per cent premium on house prices in Melbourne; in terms of unit prices, the premium is 25.5 per cent.Lawless reflects that 2014 ended with a record 101,444 capital-city auctions, with Sydney claiming the highest clearance rate (74 per cent), noting, “If this is sustained this year, it will be difficult for Melbourne to retain the title of the ‘auction capital’.”He says the data could be interpreted as either that Sydney prices may escalate further, as previously; or that the early-noughties boom was an anomaly. “On an annualised basis, home value growth is slowing in Sydney and all capital cities,” says Lawless. “Therefore, we would anticipate the gap is unlikely to increase much further.” Growth in housing finance commitments slowed in November, a further indication that some heat is coming out of the housing market. For more information go to: