Housing market softer in April after strong March quarter

According to RP Data-Rismark's Home Value Index, Australia's capital city dwelling values fell by 0.5 per cent in April after posting a solid 2.8 per cent increase over the first three months of 2013. 

The negative result for April brings the rolling quarterly movement in capital city dwelling values back to a more sustainable 1.1 per cent. Since the housing market reached a recent low point at the end of May 2012, capital city dwelling values have recovered by 4.2 per cent. 

According to RP Data's director of research, Tim Lawless, the April results represent a stumble along the path to recovery more so than a sign of a renewed trend in value falls. 

"When viewed in line with other metrics such as auction clearance rates, private treaty indicators and some improvement in housing finance demand, it is likely that the negative April result will be a blip along the path to recovery," said Mr Lawless. 

"We weren't expecting that the high rate of growth evidenced over the first three months of the year would be sustained into April. A more measured pace of growth is a much more realistic outcome for the Australian housing market, especially considering that the first quarter is typically the strongest for value growth."

Rismark CEO Ben Skilbeck added, "the quantum of the April pullback is seasonally typical of a market pause, meaning that if one were to take seasonal movements into consideration the market is not currently showing any downward trend." 

Softer capital city dwelling values were recorded across every capital city except for Adelaide where dwelling values were up 2.8 per cent over the month and in Darwin where values rose by 0.2 per cent. 

According to Mr Lawless, the April results for Adelaide should be interpreted with some caution. 

"The strong month-on-month result for Adelaide is more likely the result of natural volatility across a relatively small market rather than the any sort of sustainable surge in dwelling values over the month," Mr Lawless said. 

Across the major cities, Sydney values were down 0.4 per cent over April, while Melbourne, Brisbane and Perth saw monthly declines of 0.5 per cent, 0.7 per cent and 2.5 per cent, respectively. 

At the combined capital city level, the performances of the detached housing and the unit market have been very similar. House values have risen 2.7 per cent over the past 12 months while unit values have increased by a slightly lower 2.5 per cent.

Rental prices continue to trend higher with most cities recording an increase in rents. Across the combined capital cities, house rents were up 1.4 per cent over the three months ending April, and unit rents were up by 1.3 per cent.

For more information about the residential property market in your areas of interest, please feel free to stop by your local CENTURY 21 Real Estate office for expert and clear advice. Additionally, if you would like to speak to a mortgage professional about suitable loan packages, please contact CENTURY 21 Home Loans.


Posted by Charles Tarbey on 09/05/2013 at 12:00 AM | Categories:


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