By James Glynn
SYDNEY–Australian house prices posted a sixth consecutive monthly rise in August despite a record surge in interest rates over the last year, with the latest data showing further acceleration in prices growth.
The national home value index was up 0.8% in August from July, according to property research group CoreLogic.
The monthly gain was a slight acceleration from the 0.7% increase in July, interrupting a two-month trend of slowing capital gains. Since bottoming out in February, the index is up 4.9%.
Surging migration in the wake of the Covid-19 pandemic and fall supply in new houses are helping to fuel demand for housing.
The strength in house prices will concern the Reserve Bank of Australia, which has raised official interest rates by 400 basis points in just over a year to cool inflation. The RBA has been sidelined for a few months now, but continues to warn further hikes may be required if inflation remains sticky.
For now, it appears as if price pressures are easing across the economy.
Data showed the monthly consumer price index rose 4.9% in the 12 months to July, well below the expected rise of 5.2%, and compares with an increase of 5.4% over the year to June, the Australian Bureau of Statistics said Wednesday.
The stellar July inflation result compares with a peak in December of an 8.4% increase.
The upward trend in house prices remains broad-based, with every capital city except Hobart recording a rise in dwelling values over the month, according to CoreLogic.
The gains were led by a 1.5% increase across Brisbane, followed by Sydney and Adelaide where home values were up 1.1%, the data showed.
Sydney has led the recovery trend to date with a gain of 8.8% since values found a floor in January. Brisbane has also posted a strong recovery with values up 6.2% since bottoming out in February.
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