Australian house price growth slows

Australian house price growth slows

Posted on Thursday, October 23 2014 at 9:39 AM

Analysis by the Domain Group shows the nation’s capital city housing markets have generally softened over the September quarter this year.

The organisation’s House Price Report reveals the
national median house price increased by only 1.2 per cent over the quarter.

Andrew Wilson, a senior economist with the
Domain Group, says the result represents the first retreat in the numbers since
early 2013.

“The national house price result is the lowest
quarterly growth rate recorded since March last year and continues to be
primarily reliant on the strength of the Sydney market.”

Sydney, Melbourne and Darwin all recorded price
growth for the quarter, however Brisbane, Adelaide and Hobart saw a fall in
their median house prices.

house prices in Sydney are not accelerating at the exceptional levels recorded
last year, the growth rate has been consistent over 2014.

“The Sydney market
will continue to lead the pack, however, the clock is now ticking for that
market as further signs of moderation are emerging,”

Wilson says the results
for Brisbane were particularly unexpected.

“Surprisingly, the
Brisbane house price stalled over the September quarter with the median down by
1.3 per cent, which is the first negative quarterly result for more than two

“Adelaide and Hobart also reversed recent trends of house price growth,
recording their first falls in a year.”

During the September quarter, Perth and Canberra
saw respective falls of 1.5 per cent and 1.7 per cent in their median house

“Subdued prices growth in Perth was no real
surprise as that market has consistently reported waning buyer activity over
the past year,” Wilson says.

Meanwhile in Darwin, prices rose sharply by 2.9
per cent.

“Volatility in Canberra and Darwin is also a
continuation of recent market trends,” he says.

In terms of units, the analysis revealed Sydney
and Adelaide were the only two capitals to see price gains during the period.

Wilson says policymakers need to take heed of
the numbers.

“Without a sustained revival in economic
activity, housing markets will continue to soften, ending the debate about macro-prudential
tools or changes to property taxation policy designed to offset local and foreign
investor activity.”

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