The escalation of house prices serves as a deterrent to the likelihood of rate cuts by the RBA.

Melbourne’s home values experienced their most robust growth in six months, with units seeing an increase of nearly $7000 and houses gaining close to $1300 in February. However, this growth is trailing behind the national trend, as heightened inventory levels in the Victorian capital have kept property values relatively stagnant, providing buyers with more options.

According to PropTrack’s latest Home Price Index, the typical cost of a dwelling in Melbourne, encompassing both houses and units, rose by approximately $10,600 (1.33 percent) from $786,400 to $797,000 in the 12 months leading up to February 29. This growth pales in comparison to the substantial increases witnessed in Perth and Adelaide, where median prices surged by around $103,000 (16.32 percent) and $90,400 (12.76 percent) to $651,000 and $709,000, respectively.

The accelerated growth in other capitals is even bringing them closer to Melbourne, with Brisbane’s median house and unit prices now nearly on par with those of Melbourne.

Median house and unit values for February stood at $909,000 and $607,000, rising by approximately $1273 (0.14 percent) and $6920 (1.14 percent) since the previous month, respectively.

PropTrack senior economist Eleanor Creagh highlighted that January marked one of the busiest Januarys in over a decade in terms of new listings in Melbourne, with inventory levels remaining well above the decade average since August of the previous year.

“Despite the increase in listings, demand has managed to keep pace, continuing to support property values,” Ms. Creagh stated. “Moreover, the pace of growth in Melbourne has picked up after decelerating towards the end of 2023, marking the city’s strongest monthly growth rate since August.”

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