Australia’s residential property market is red hot once again, with new data from RP Data and Riskmark International showing house prices rose 0.9% in July on a national basis.
The rise means house prices have now risen 5.9% over the first seven months of the year, and now sit 1.8% above the peak hit in February 2008.
Rpdata.com’s national research director Tim Lawless pinned the rises on historically low interest rates and a surprisingly steady unemployment rate.
“Australia’s residential market has been further supported by low mortgage default rates, at just 0.6%, compared with 5% in the US and 3% in Britain.”
Melbourne and Sydney home values have led the charge in 2009, rising by 8.5% (to a median price of $454,524) and 6.6% (to a median price of $537,396).
But every capital city has enjoyed growth. Darwin’s prices have shot up 10.8% to a median of $466,903 while Canberra (up 5.4%), Brisbane (up 3.8%), Perth (up 2.5%) and Adelaide (up 1.9%) have all shown good growth, given the economic environment.
Rismark’s Christopher Joye says the fact the house prices are even rising in Australia’s most expensive suburbs proves the market is not just being supported by first home buyers.
“While first time buyers initially furnish the early momentum, upgraders and investors have now taken over the baton as we anticipated. This is reflected in the superior performance of houses compared with units since the first quarter of 2009.”
Meanwhile, auction results have continued to perform well with Melbourne recording a clearance rate in excess of 80% for the 16th consecutive week.
The city recorded a clearance rate of 85%, with 547 properties sold out of the 642 auctions recorded. Real Estate Institute of Victoria chief executive Enzo Raimondo said in a statement the news “removes any remaining questions about the strength of the market this year”.
Total sales reached $370 million, with volumes increasing next weekend to just under 600 auctions.
In Sydney, results were also positive with a clearance rate of 74%, with 159 properties sold out of 209 auctions, totalling $118 million in sales.
Brisbane results were slightly higher at 59%, but only 17 properties sold, reaching a total of $4 million. Adelaide recorded a 53% clearance rate with 17 properties reaching $5 million.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
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