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House prices up in January (but growth slows), which ASX shares to buy?

growth shares

The latest CoreLogic Home Value Index is out for January 2020, which ASX shares would be a good buy after the results?

According to the data, Australian national dwelling prices rose by 0.9%. In a very positive update for the country, every capital city recorded an increase in price. Indeed, every regional area (except regional South Australia) saw dwelling price growth as well.

This is a sign that the property market recovery which started in Sydney & Melbourne in mid-2019 has now spread to the whole country.

Australia’s biggest property markets, Sydney and Melbourne, saw price growth of 1.1% and 1.2% respectively over the month. Hobart house prices went up by 0.9% and Brisbane saw prices go up 0.5%.

Looking at the other cities, Canberra prices rose 0.3% and Adelaide prices went up 0.2% whilst Perth and Darwin both saw growth of 0.1%. That’s not much of an increase, but Perth and Darwin have seen years of declines, so a slight increase is welcome.

Brisbane, Adelaide, Hobart and Canberra house prices are now the highest they’ve ever been, but Sydney is still 5.4% lower than its peak and Melbourne is 1.2% lower than its peak.

What about ASX shares?

Worries about the coronavirus are distorting what property shares may have done on a normal day. But, let’s take a look:

The REA Group Limited (ASX: REA) share price is down 1.7%.

The Domain Holdings Australia Ltd (ASX: DHG) share price is down 0.5%.

The McGrath Ltd (ASX: MEA) share price is flat.

The Stockland Corporation Ltd (ASX: SGP) share price is down 0.5%.

The Brickworks Limited (ASX: BKW) share price is down 0.3%.

The Commonwealth Bank of Australia (ASX: CBA) is down 1%.

Foolish takeaway

Property seems like it will have a positive year in 2020, though there’s a good chance that growth will slow as affordability becomes a limiting factor again.

Where to invest $1,000 right now

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Brickworks and REA Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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