Australian Home Prices Surge Despite Rate Hikes

0:00On March 2nd, here's the latest out of Sydney. Australian home prices keep climbing, despite interest rate hikes, with the fierce battle over cheaper properties driving what's being called ANN UPCRASH. National median prices rose 0.8% in February, pushing the average of more than $7,300 to nearly 9. $123,000. Economists pointed desperate first home buyers competing hard against investors for affordable units. Meanwhile, gains were strongest in undersupplied cities like Perth, where prices jumped 2.3% or about $22,500. Brisbane, Adelaide and Hobart, each saw increases over 1%, while Sydney and Melbourne stayed flat, especially at the high end. Buyers aren't backing down, even with rate rises adding over $130 to monthly payments on a typical $900,000 mortgage. One open house in Brisbane drew 55 people right after a rate hike

1:00and a two-bedroom apartment there sold for $870,000. Dollars, well over budgets. Investor loans surged nearly 8% over the past year, outpacing owner-occupier borrowing, as banks compete aggressively with lower rates. Total home loans hit a record $2.44 trillion, surprising the reserve bank. Economists expect prices to keep rising steadily, fueled by fear of missing out in government schemes, unless much bigger rate hikes hit. Markets see another increase likely by May or August, but household optimism for real estate remains at record levels. Quick thanks to today's sponsor. See the description for more.