The latest Australian Property Market report indicates a modest jump in property prices in the first quarter of 2013 and experts are crediting rising confidence and low interest rates. Median house prices improved in several large markets including Darwin, Perth, Melbourne and Sydney, all of which contributed to the 1.7% quarterly gain. Increases were not across the board, however, as Adelaide, Canberra and a few other notable regions experienced price falls in the same period. Analysts predict the numbers will improve even more before the end of the year. For more on this continue reading the following article from Property Wire.
Low interest rates and rising confidence in the property market has resulted in national house prices rising by 1.7% in the first quarter of 2013.
This follows a rise of 1.8% in the fourth quarter of 2012 and prices are now just 1% below the peak of June 2010, according to the latest Australian Property Monitor house price report.
Melbourne, Sydney, Perth and Darwin all recorded significant increases in their median house prices over the March quarter.
Melbourne had the strongest price growth at 3.6%, best performance by the Melbourne housing market since the March quarter of 2010. Melbourne’s median house price has now risen by 3.7% over the past year but remains 4.2% below its previous peak level.
In Sydney median house prices increased by 1.6% and the has now posted consecutive quarters of record level median house prices. Andrew Wilson, senior economist for Australian Property Monitors said it has clearly moved from the recovery phase that began early in 2012 into a solid expansionary phase of cyclical house price growth.
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The Brisbane housing market saw a rise of 0.5% and the city has now recorded three consecutive quarters of growth in house prices for the first time since the September quarter of 2010 indicating a market at last on the upswing.
The resource capitals of Perth and Darwin continue to record hefty increases in median house prices as strong, low unemployment economies attract high numbers of workers from elsewhere. In Perth house prices rose by 1.3% and in Darwin they were up by 1.8%.
Perth house prices have now risen by 5.2% over the year to the end of March with Darwin up by 5.4%, the best performances of all the capital cities.
Adelaide and Canberra bucked the national trend, each recording falls in median house prices over the March quarter, down by 0.8% and 0.4% respectively. Wilson pointed out that subdued house and unit price growth in these cities reflects the burden of struggling local economies particularly in regard to relatively high and rising unemployment.
Although Hobart recorded an increase of 0.5% in the median house price over the March quarter, that market remains subdued also as a consequence of a struggling local economy. Hobart house prices remain 9.2% below their previous peaks, the worst performance of all the capital cities.
‘The national housing market has recorded its best start to a year since the strong market conditions of 2010. Strengthening auction clearances rates and increased residential lending activity have translated into rising house prices over the March quarter,’ said Wilson.
‘A general housing market recovery is clearly consolidating as expected although activity levels vary between capital city markets and sub-markets reflecting the mixed impact of local supply and demand drivers,’ he explained.
He believes that buyer activity is set to increase through the remainder of 2013 driven by record low interest rates and rising confidence. ‘Much as usual will depend on the performance of both the national and local economies with the current general outlook however remaining optimistic. Growing optimism and rising house prices will continue to motivate home buyers and investors to take advantage of historically low interest rates that more likely than not have now bottomed out,’ he added.
This article was republished with permission from Property Wire.