Look what’s happened to property values around Australia

RP Data  released their Home Value Index for the end of November today showing that dwelling values across all of Australia’s capital city housing markets, except Melbourne, rose over November with values now just -0.1 per cent lower over the past 12 months.

Across the 8 capital cities, the month of November saw the RP Data-Rismark Home Value index rise 0.4 per cent during the first two weeks only to relinquish these gains in the last two weeks of November and finish flat for the month.

As usual, there existed notable dispersions in the returns observed across the individual capital cities. Melbourne home values fell by -1.0 per cent over the month while all other capital cities rose.

The strongest performer over the month of November across the major capital cities was Perth where improving housing market conditions were evident with values up 1.0 per cent.

Brisbane and Adelaide values each increased by 0.5 per cent while Sydney values rose by just 0.1 per cent.

On a quarterly basis, most capital cities recorded a rise in dwelling values.

The largest capital gains being found in Darwin (+3.1%), Perth (+3.0%), Brisbane (+0.8%) and Sydney (+0.6%).

The only cities where values were down over the three months ending November were Canberra and Melbourne (both -0.7%) and Hobart (-4.5%).

What’s happened over the last year?

On an annual basis, Sydney (+1.3%), Brisbane (0.3%), Perth (+3.4%) and Darwin (+13.1%) have each shown a rise. The largest fall over the past twelve months to the end of November was recorded in Hobart, where dwelling values are down -7.0 per cent.

According to RP Data Senior Research Analyst Cameron Kusher, the November market conditions highlight that the road to a market recovery will not be without pauses and those cities which performed very strongly in 2009 and 2010, like Melbourne, may show continued weakness.

“Capital city home values remain -5.6 per cent lower than their historic highs of 15 November 2010, but, up 2% from their low of late May 2012.”

“Home values in Brisbane and Perth remain below where they were five years ago whereas the other mainland cities have all increased over this period. This has meant that relative to the other capital cities, Brisbane and Perth have experienced affordability improvements and subsequently we may see them become more popular from both an owner occupation and investment perspective.” Mr Kusher said.

Rismark International CEO, Ben Skilbeck, commented, “With the recent sharp improvement in consumer sentiment showing that optimists now outweigh pessimists, house price to income ratios back at 2003 levels and meaningful recent housing affordability gains, it will be interesting to see the impact on the housing market if interest rates are further cut in December as widely anticipated. Given the historically weak seasonal month of December, if rates are cut in December, it’s likely we’ll have to wait until early in the new year to see the housing market response.”

Australian Bureau of Statistics economic data key to the housing market, including building approvals and housing finance commitments to owner occupiers, are also showing improvement over recent months. These improvements are being reflected in an increased level of sales activity and improving home values across a number of capital cities over recent months.

Source: RPData


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Tim heads up the Core Logic RP Data research and analytics team, analysing real estate markets, demographics and economic trends across Australia. Visit www.corelogic.com.au

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