New figures reveal that the tide may be turning for Australia’s top suburbs, with signs the market is lifting.
RP Data research analyst Cameron Kusher said premium housing markets had generally recorded a larger correction in values than other price segments with the current recovery rate below par.
However, recent results showed that premium housing was once again beginning to outperform the broader housing market.
In three months up to September, premium house values were 4.2 per cent higher and unit values were 2.9 per cent higher.
The quarterly value growth for premium houses was greater than both the affordable (2.6 per cent) and middle (3.6 per cent) markets whereas premium unit values underperformed both the affordable (3.9 per cent) and middle markets (3.4 per cent)
“Based on our findings, the premium market is experiencing increasing levels of value growth. However, it is largely contained to detached houses rather than units,” Mr Kusher said.
Across the individual capital cities, the annual rate of value growth across the premium suburbs had been weakest across all major capital cities and product types except for Melbourne houses, where the value growth had been stronger than growth for the most affordable suburbs.
Over the past quarter, growth in house values had been stronger than the other sectors for houses in Melbourne and Perth, and equal strongest in Sydney.
Mr Kusher said that overall, after a lacklustre performance in the more affordable sectors of the housing market, the premium sector was starting to see a stronger growth performance.
“While picking up pace, the growth across premium suburbs has largely been limited to detached houses and is very much evident within the Sydney, Melbourne and Perth where the growth cycle has been stronger than other cities," he said.
“Recent high levels of auction clearance rates, particularly in Sydney and Melbourne, have certainly pushed the premium housing market along.
"Of course, auctions are only a small overall proportion of the market; higher priced and unique properties which are typically taken to auction are more a reflection of the performance of the premium housing sector.”