Taylor Scott International News
Property prices in Australia’s capital cities increased by 0.5% in February and by 1.4% over the last three months, according to the latest index figures. However the trend in annual growth has slowed over the last seven months from 11.1% to 7.6%, the CoreLogic RP Data home value index also shows. Prices increased in all capital cities apart from Perth and Canberra were prices fell by 1.1% and 0.2% respectively and over the past three months they increased across all capitals except Sydney where they fell by 0.2%. An examination of the data shows that the largest monthly increases in home values were recorded in the cities that have been underperforming over the growth cycle to date. In Hobart values were 2.9% higher, Adelaide up 1.9% and Brisbane up 1.8%. The cities to record the greatest value rises over the past three months have been Hobart with growth of 8.5%, Melbourne up 3.8% and Brisbane up 2%. According to CoreLogic RP Data head of research Tim Lawless, even though home values have trended lower over the year in Perth and Darwin, they have recorded value rises of 0.2% and 0.3% respectively over the past three months. He also pointed out that while values are still increasing across most capital cities however, the results remain diverse. Sydney and Melbourne remain the strongest markets in trend terms, however, the gap is widening between the performances of Melbourne relative to Sydney. Over the past 12 months, combined capital city home values have increased by 7.6%, with the annual rate of growth down from a recent peak of 11.1% recorded in July last year. Melbourne has maintained its number one growth position, with annual capital gains of 11.1%. ‘Melbourne values appear to be holding reasonably firm since December last year with the annual rate of capital gain virtually level over the past three months,’ Lawless explained. Sydney’s annual rate of growth has continued to moderate, having almost halved from its cyclical peak of 18.4% recorded in July last year to reach 9.5% growth over the past 12 months. Lawless said that despite the slowing trend, Sydney remains the second best performing capital city over the past year but he pointed out that a few of the smaller cities where growth rates have recently accelerated may start to rival Sydney’s position over the coming months. ‘The trend in home value growth is showing signs of increasing in those markets that have previously underperformed. These include Brisbane, Adelaide, Hobart and Canberra. Affordability constraints aren’t as apparent in these cities and rental yields haven’t been compressed to the same extent as what they have in Melbourne or Sydney,’ Lawless said. ‘Home values increased in Brisbane by 5.5% over the past year, which is the fastest annual rate of value growth in a year. In Hobart, home values are 6.2% higher over the year, which is its fastest annual rate of home value growth since July 2010,’ he added. Taylor Scott International
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