Property Price growth since 2007

What’s been happening in property markets since 2007?

The Reserve Bank of Australia (RBA) released its latest Chart Packs during the first week of August recording the latest housing prices.Chart Packs

As I expected, beyond the financial crisis the rising tide of household debt could no longer lift all boats, and so far capital growth has been strongest in the two largest capital cities, but considerably weaker elsewhere.

Drivers of markets going forward will include jobs growth, population growth, real wages growth and foreign capital, among a number of other factors.

Predictably the Sydney property market has been the clear standout, with house prices in round numbers having appreciated by ~$400,000 (from ~$550,000 to ~$950,000), or more than a ~70 per cent increase.

The line denoting Sydney would look far steeper if it wasn’t for the fact the RBA switched from using a linear scale to a log scale at the end of the first quarter.

If you aren’t sure what this means – take a read of my short blog post here which explains it and why the change was made – pretty interesting stuff. 

 Sydney property market

At the other end of the scale, Adelaide’s median house price has appreciated by around ~$100,000 from ~$350,000 to ~$450,000, or close to a ~30 per cent increase.

Regional house prices in aggregate showed the lowest price growth of under $100,000, the chart following a very similar trajectory to that of Adelaide.

In Brisbane median house prices are below their 2010 peak according to CoreLogic-RP Data(albeit only very marginally) but are now rising.

For my money, Brisbane offers the best “value” of any of the capital city markets, though investors need to be particularly careful about what they are buying, for the reasons well documented here previously.

The trendline below which records investor loans on a 12mMA basis shows that Queensland investor lending in aggregate is now tracking at its highest level since April 2008 and rising.

 Brisbane offers the best "value"

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Pete Wargent is a Chartered Accountant, Chartered Secretary and has a Financial Planning Diploma. He’s achieved financial freedom at the age of 33 - as detailed in his book ‘Get a Financial Grip – A Simple Plan for Financial Freedom’. Pete now manages his investment portfolio, travels and works as a consultant in the finance industry from time to time. Visit his blog

'Property Price growth since 2007' have 1 comment

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    August 19, 2015 @ 6:57 pm George

    The most important point of this article is that it clearly demonstrates that property prices always fall after a period of strong growth. Oh how many times i hear people say that property prices never fall ! Every property buyer (investor and home owner) should be made aware of these graphs. Would save a lot of pain and misery.


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