Antipodean Housing Deep Dive

Housing supply to come under pressure

Each month we take a graphical deep dive into the Antipodean housing markets (behind the paywall).

Housing prices have been trending gradually higher in Australia and New Zealand for several months. Housing price growth across Australia’s capital cities has diverged, with Sydney and Melbourne at the softer end amid a pick-up in listings of homes for sale. In contrast, housing price growth in Perth is running at ~2% m/m.

Mortgage repayment affordability remains very stretched amid relatively high interest rates but accumulated savings since 2020 (and intergenerational transfers) have assisted deposit affordability.

Leading indicators of residential construction have weakened on both sides of the Tasman, though builders are still working through backlogs of work, particularly in Australia. A noticeable decline in residential construction seems likely over time.