Housing market healthy, but stabilising
8 March 2005
December quarter 2004 housing data released by the Real Estate
Institute of Australia (REIA) today shows that growth in house
prices has stabilised.
"Interest rate rises in late 2003 served to dampen the market.
The March 2005 interest rate rise, together with the possibility
of another rise soon, can also be expected to impact on prices.
However Australians understand and have confidence in property.
Australians in general remain committed to the housing sector,
both for their own homes and for investment," says REIA
President, Ian Wells.
The quarterly Australian weighted average median house price
reported in the December quarter 2004 edition of Mortgage Choice
/ REIA Real Estate Market Facts was $371,853 in December 2004,
up from the September 2004 price of $364,803, and the December
2003 price of $362,734.
Median house prices declined 0.7 % to $471,500 in Sydney in the
December quarter. Median house price growth was recorded in
Darwin (0.2 % to $260,000); Adelaide (2.7% to $270,000);
Canberra (2.9% to $350,000); Brisbane (3.0% to $309,000); Hobart
(3.5% to $265,000); Melbourne (5.2% to $382,000) and Perth (5.5%
to $267,000).
For the year to December 2004, falls were recorded in Melbourne
(-1.2%), Sydney (-1.8%) and Canberra (-2.8%). Hobart experienced
the largest growth (17.1%), followed by Darwin (13.0%), Adelaide
(10.7%), Perth (8.1%) and Brisbane (3.7%).
‘Median prices for other dwellings have flattened substantially
compared with the high rates of growth experienced in 2003,’
says Ian Wells.
In the other dwellings sector (flats, units, townhouses) in the
December quarter, falls were recorded in Canberra (-1.1% to
$275,000) and Darwin (-2.8% to $175,000).
Increases in median prices for other dwellings were recorded in
Sydney (1.4% to $360,000), Brisbane (3.5% to $238,000),
Melbourne (4.1% to $302,000), Hobart (6.6% to $208,000), Perth
(7.5% to $215,000), and Adelaide (13.7% to $216,000).
For the year to December 2004, median prices for other dwellings
fell in Canberra
(-3.3%) and remained flat in Sydney (0.0% change). Prices
increased in Melbourne (2.4%), Brisbane (6.3%), Darwin (9.4%),
Perth (13.8%), Adelaide (16.8%) and Hobart (26.8%).
"Interest rates will be the most important factor in determining
where the market will move in the coming months," says Ian
Wells.
"There is already evidence of substantially reduced investor
activity, particularly in the market for other dwellings. This
month’s interest rate rise will impact prices in the coming
months. We call on the RBA to recognise the changing conditions
in the housing market and to allow time for the impact of the
March rate rise to be measured, as it makes further
deliberations about interest rates."
