The latest Rismark Home Value Index also shows that over 12 months values increased by 7.9% and are up 8.2% year to date. It is the fastest pace of growth in three years.
RP Data's senior research analyst Cameron Kusher explained that the latest data also emphasises the strong housing market conditions in Australia's two largest cities, Sydney and Melbourne, which is having a strong influence on capital growth across the combined capital cities.
Sydney home values increased by 2.4% in October and increased by 5.5% over the past three months while in Melbourne, home values increased by 1.2% in October and recorded an increase of 3.8% over the past three months. ‘For the first 10 months of this year, Sydney and Melbourne house values have performed very strongly achieving growth of 13.4% and 8.7% respectively,’ Kusher said.
Ben Skilbeck, Rismark chief executive officer, added that while Sydney has eclipsed its previous cyclical high and Melbourne is near its peak, Brisbane remains 8.4% below its highs.
‘There is, however, evidence that growth conditions may be spreading to Brisbane with home values in that city rising by 1.4% over the month and 2.6% over the past three months. While Brisbane auction clearance rates are typically low in comparison to Sydney and Melbourne due to differences in the preferred sale mechanism, Brisbane auction clearance rates are approaching the 50% mark which was last consistently observed in 2009 when values increased 7.1% over the year,’ he explained.
Values increased by 0.3% in Adelaide and by 1.6% in Darwin, but they fell by 0.2% in Perth, were down 2.3% in Hobart and down by 1.5% in Canberra.
Kusher said that of note were the recent weaker capital growth conditions for the Perth housing market. According to Kusher, two months ago Perth was experiencing the fastest 12 month rate of value growth of all capital cities at 9.4% but this has now slowed to 6.9% following a 0.6% fall in home values over the past quarter.
‘Although values are broadly rising, the strength in the market is being fuelled by Sydney where home values have only increased at an average annual rate of 2.7% over the past decade. Therefore, it is little wonder that the Sydney market is responding strongly to record low mortgage rates given its long period of underperformance coupled with a pent up undersupply of new housing over recent years,’ he pointed out.
Outside of the home values growth, most other indicators are pointing to an ongoing improvement in overall housing conditions. Over the three months to August 2013, RP Data estimated that capital city home sales were 20.1% higher than the same time in 2012. The number of capital city properties listed for sale is 12% lower than it was a year ago.
Most Popular Slideshows
- Victoria's Secret Fashion Show 2013: Models' Ramp Walk Aired on Tuesday [PHOTOS]
- Victoria's Secret Fashion Show 2013: Bold, Sexy and Sensuous Lingerie Fashion [PHOTOS]
- Victoria's Secret Fashion Show 2013: Drooling Guys, Conscious Girls, Naughty Jokes on Twitter [SEE PHOTOS]
- Victoria's Secret Fashion Show 2013: Best Pictures From The Sexiest Show Ever [ SEE PHOTOS/VIDEOS]