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ISCOVER
Staff Reporter
New data indicate the Australian property market is definitely on the way up, with capital city values climbing 0.3 per cent in February.
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According to RP Data’s February Hedonic Home Value Index, this is the second month of growth for values following a 1.2 per cent rise in January.
The strength in the monthly result was largely driven by Australia’s second largest housing market, Melbourne, where dwelling values were up 1.5 per cent.
Values also appreciated across Sydney, Canberra and Darwin, while the remaining capital cities recorded a fall in values.
Brisbane recorded the largest month-on-month fall where dwelling values were down 1.1 per cent after rising 2.0 per cent in January.
On a quarterly basis, every capital city of Australia, apart from Adelaide and Darwin, has recorded a rise in dwelling values.
The largest increase over the past three months has been in Hobart where dwelling values are up 4.2 per cent.
RP Data research director Tim Lawless said while the February results are not as broad-based as those recorded in January, with only half of Australia’s capital cities recording a lift in dwelling values over the month, the trend for most cities remains positive.
“While the housing market is staging a demonstrable recovery, we need to see values rise a further 4.3 per cent before we can say that a technical recovery has been achieved. That amount of value appreciation is likely to be at least six months away,” he said.
“The quarterly trend rate of housing value growth is slightly higher than inflation and pretty much in line with wages growth, which is arguably exactly what the RBA [Reserve Bank of Australia] is hoping for,” Mr Lawless said.
Rismark International’s Ben Skilbeck said in an environment of significantly improved consumer confidence, the housing market is responding positively to almost record low monetary policy settings.
“A recent statement by the RBA governor and the House of Representatives noted that lending rates have fallen to levels not far from their historic lows and the share of household income devoted to interest payments has declined considerably while housing affordability, as conventionally measured, has improved a lot over the past two years. Consistent with the RP Data-Rismark indices, the RBA governor also noted housing prices have been rising since May last year.”
