As reported by The Urban Developer, most cities across the nation are witnessing skyrocketing property prices - lifting 6.7%, or $50,000, in the June quarter.
According to the Australian Bureau of Statistics, property prices have risen by 16.8% year on year after being supercharged by historically low interest rates, government incentives, forced household savings and elevated demand for bigger homes. By comparison, apartment and townhome prices have experienced an average of 13% increase over the same period, making these the most attainable homeownership option for many Australians regardless of their buyer type.
“With the exception of Hobart and Darwin, capital cities continued to see house prices outpace those of attached dwellings such as apartments and units,” said Michelle Marquardt, head of prices statistics at the Australian Bureau of Statistics.
Many off-the-plan apartments and townhomes are now being designed with spaciousness in mind, comparable to the generous floorplans found in traditional detached houses. Nearly all also feature outdoor space by means of a balcony, terrace, courtyard or fully furnished rooftop gardens to offer residents the ideal indoor-outdoor lifestyle. This means buyers can enjoy all the characteristic traits of a traditional house with a much more affordable price tag, and generally in a more enviable suburb.
Despite surging property prices and strong predicted growth, low interest rates have made homeownership more affordable than renting. With the Reserve Bank of Australia’s commitment to maintaining low interest rates until 2024, homeownership is expected to be cheaper than renting across many suburbs.
Nationally, rental prices have increased by 8.2% over the last 12 months ending August 2021, demonstrating the largest rise in rental prices since 2008. Reports indicate that almost 75% of apartments in Australia will be cheaper to buy than rent over the next 10 years. Considering the rental increases and the Government’s financial incentives available for a range of buyer types, including first home buyers, these trends indicate that purchasing an apartment or townhouse offers the most financially viable option for many.
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