National house prices keep rising: Brisbane climbs 3% in the first quarter, with the city's five-year total growth now exceeding 63% — the highest in Australia!

National house prices reached a record high in March and are set to climb further in the coming months, as strong population growth and a tight rental market, combined with the lowest building rates in a decade, have created an imbalance between supply and demand.

The PropTrack Home Price Index showed that national residential prices rose 0.34% in March to a new record high, taking price growth to 1.57% for the quarter and nearly 7% above March 2023.

The changes in each state's median price over the first quarter of 2024 are shown in the chart below:

Creagh said the supply and demand imbalance could further offset the effects of stretched affordability and a slowing economy, and she expects any interest rate cuts to accelerate price growth. The economist added that although the migration rate is expected to ease from this year's record high, the number of homes under construction is well below the government's target of 1.2 million dwellings, which will help push up buying prices.

First-home buyers rose 16.8% in the first quarter of 2024 and 12.8% over the 12 months to December 2023.

According to an analysis of migration and construction data, Brisbane and the Gold Coast are the areas facing the most severe housing shortages in Queensland.

The analysis also found that in the past financial year, the number of migrants arriving in Australia exceeded the number of homes built by 380,000.

According to research by the Institute of Public Affairs, Australia's housing supply increased by 148,600 new dwellings in the 2022-23 financial year, while net overseas migration for that year was 528,392 people — 3.5 times the total number of new dwellings. Based on the assumption of an average Australian household size of 2.5 people, 211,357 dwellings were needed, which would mean a shortfall of 62,757 dwellings.

A comparison of the number of houses built and population growth in Queensland's major regions is shown in the chart below: It is clear that almost all are in a market where demand outstrips supply.