Wednesday, 1 August 2012

Australian cities see home prices rise for first time in almost two years

According to the latest statistics published by the Australian Bureau of Statistics(ABS), house prices in eight of Australia’s largest cities have increased by 0.5% in the second quarter of this year in comparison to the first three months of 2012. Since the December quarter of 2010 this is the first time house prices have risen.

The ABS statistics show that the biggest increase was 5.1% in Darwin. The next largest increase was seen in Sydney where they have risen by 1.4%, then in Perth they increased by 0.6% and in Adelaide they increased by 0.5%.

Brisbane only witnessed a marginal increase of by 0.1%, while elsewhere prices fell. The steepest fall in house prices was seen in Canberra where they fell by 1.3%, followed by Melbourne and Hobart where prices fell 0.4% in both cities.

Andrew Harwvey, senior economist for the Housing Industry Association (HIA) said that, 'The figures may be an indication that we are returning to an environment of housing price growth in some of Australia’s major housing markets. Given that housing affordability is at its highest level in more than two years the result is not a surprise as good earnings growth and interest rate cuts may mean the end of the modest correction we have been seeing in house prices'.

He added that, 'The data will be yet another blow to the housing market doomsayers that, against all available evidence, continue to portend a collapse in Australia’s housing market. The fundamentals of Australia’s housing market remain very strong. Rents continue to grow at a rate well above headline inflation, rental vacancy rates are tight, and Australia’s unemployment rate remains the envy of the developed world”.

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