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Look what happened to property values last month – latest RPData figures

The latest stats from RPData show that capital city home values in Australia rose by 1.6 per cent over the last three months however, during the seasonally slower month of August, value growth flat lined.

Seven of Australia’s eight capital cities have registered capital gains over the last three months with the exception being Adelaide.

After recovering by one per cent in June and 0.6 per cent in July following the RBA’s back-to-back rate cuts, dwelling values across Australia’s combined capital cities were unchanged in August.

At the end of August, dwelling values across Australia’s combined capital cities were down just  -0.6 per cent in the first eight months of the year compared to a -2.2 per cent year-to-date loss in May.

The year-on-year numbers have also shown a substantial improvement. Dwelling values were down -2.4 per cent at the end of August compared to -5.3 per cent in May.

Dwelling values in both Sydney and Melbourne both increased by 0.1 per cent over the month of August, with the two biggest capitals recording 2.4 per cent and 2.5 per cent capital growth, respectively, over the last three months.

In August gains were also seen in Adelaide (+1.4 per cent), where housing values had struggled in recent months, and Canberra (+1.2 per cent).

The markets weighing down the result were Brisbane (-0.2 per cent), Perth (-1.2 per cent), Hobart (-1.2 per cent) and Darwin (-0.5 per cent). However, all cities except Adelaide have experienced a net increase in home values over the last quarter.

According to RP Data research director Tim Lawless, Sydney is proving to be one of the most consistent performing capitals this year.

“Sydney dwelling values have increased over five of the past eight months providing a cumulative capital gain of 1.9 per cent over the year to date. Canberra (+1.4 per cent), Hobart (+3.9 per cent) and Darwin (+8.4 per cent) have also yielded owners capital gains over the first eight months of 2012. In contrast, other capitals, like Adelaide (-1.3 per cent), Brisbane (-1.4 per cent), Perth (-2.5 per cent) and Melbourne (-2.6 per cent), have recorded tougher conditions this year.”

Mr Lawless noted that the rebound in Melbourne was encouraging given more worrying signals earlier in the year:

“In May 2012, Melbourne home values were down 5.1 per cent in just the first five months of the year. However, the bounce in the period since the RBA’s May and June rate cuts has helped Melbourne values claw-back about half of these losses to be off a more palatable -2.6 per cent,” Mr Lawless said.

Highlighting the improved affordability over the past quarter, Mr Lawless points out that almost every capital city has recorded capital gains over the last three months.

“Improved affordability since June has helped dwelling values rise across every capital city over the three months ending August 2012, apart from Adelaide. The big question is, ‘can this growth be sustained?’ On the one hand, winter is seasonally slow, so these results have been encouraging.”

“On the other hand, we know that there is likely to be an increase in new supply over Spring, which may introduce some headwinds for a recovering market. How the market plays out over the Spring season will be an important litmus test for its resilience,” Mr Lawless said.

A spokesman from Rismark added, “Late last year we forecast that housing conditions in 2012 would deliver a material improvement over the -3.8 per cent loss suffered in 2011. Despite the fact that the RBA did not cut rates again until May, and we had the banks hike rates by about 25 basis points in the intervening period, the national market has clearly stabilised.”

“Substantially improved housing affordability combined with new demand deriving from the self-managed superannuation and Asian markets are a positive. Price adjustments in the luxury market in concert with global economic uncertainty are demonstrable negatives. We remain of the view that 2012 will yield better outcomes than those experienced in 2011.”

Source: RPData.com

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