Home prices are starting to surge at the high end of market

The latest home value index results from CoreLogic showed the strongest monthly rate of growth in national dwellings since August 2003. A striking feature of the current upswing is the pace at which the ‘high’ end of the market has risen in recent months. The high tier is the top 25% of property values in any given region. As of February, this refers to dwelling values at around $960,000 or higher for the combined capitals, with a typical value in the high tier around $1.2 million. Over February, the top 25% of values in the combined capital cities jumped 2.7% in value. This was up from an increase of 0.5% in January.

The high end of the market clearly led growth in values over the month. The middle 50% of dwelling values (the mid-tier) increased 1.5%, and the ‘low’ end of property values (the low tier) increased 1.2%. As can be seen in the rolling quarterly growth of tiered indices across the capital cities, the uplift at the high end of the market follows a deeper downturn during the height of COVID restrictions in 2020. We expect to see buyer inquiry and confidence increase over the next quarter.