Australian house prices have risen nationally for the first time since September 2010, indicating tentative signs of a recovery in the housing market that is generally expected to gather momentum in 2012.
The latest figures from Australian Property Monitors show that prices in Melbourne fared best, increasing by 1.1% in the final quarter of 2011, the best result of all the capital cities and the first rise since December. The median house price for Melbourne is now $538,448.
Sydney House prices were flat over the December quarter after recording a fall of 1.8% in the previous quarter. Sydney’s median house price is now $636,822.
These figures were the principal contributors to a small rise in the national median house price during the December quarter, according to Andrew Wilson, senior economist at Australian Property Monitors.
He pointed out that although the rise in the national median house price was modest, it was nevertheless the first increase recorded since 2010 and provides some hope that the national housing market is bottoming out after a generally subdued 2011.
Although Melbourne and Sydney house prices held up over the December quarter, Brisbane and Perth continued to be the underperformers, with prices falling 1.2% in both cities.
‘Australian house prices have risen nationally for the first time since September 2010, indicating tentative signs of a recovery in the housing market generally expected to gather momentum through 2012 in most capital cities,’ said Wilson.
Adelaide and Hobart also recorded increases in median house prices each rising by 0.5% over the quarter. Canberra and Darwin also recorded falls in median house prices over the December quarter.
An improvement in housing affordability as a result of falling interest rates and subdued house price growth together with the continuing prospect of strong economic growth, particularly in the resource sector exposed states, should see most Australian capital city housing markets recover through 2012.
Figures from RP Data-Rismark also indicate that the rate of decline in house prices across the nation slowed towards the end of last year.
‘The December quarter was the year’s smallest quarterly decline,’ said RP Data research director Tim Lawless.
Capital city house values fell nationally, in seasonally adjusted terms, in the last three months of 2011 by 0.5% the RP Data-Rismark’s figures show.
That followed a larger decline in the previous June and September quarters of 0.8% and a more substantial national drop of 1.5% in the March quarter for 2011.
‘One of the things we’re expecting to see following the interest rates cuts last November is more activity,’ said Rismark managing director Ben Skilbeck.
‘We expect transaction volumes to pick up in February and March. We would expect the negative growth to abate,’ he added.