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Published 02 April 2013 11:34, Updated 03 April 2013 13:39
Adelaide was the only capital city market to go backwards in the March quarter, with median values falling 0.5 per cent. Photo: Fairfax Media
Low interest rates and renewed interest from investors have helped national home values rise 2.8 per cent in the first three months of the year, according to new figures from RP Data.
The data shows the national median home value rose 1.3 per cent in March, taking the quarterly rise to 2.8 per cent.
Hobart posted the biggest gains for the quarter, with dwelling values up an impressive 6.1 per cent, while gains in Perth (4.1 per cent in the quarter), Canberra (3.8 per cent) and Sydney (3.4 per cent) were also strong.
Melbourne home values were up 2.5 per cent, while Brisbane had rises of 1.9 per cent.
Adelaide was the only city to go backwards, with median values falling 0.5 per cent during the quarter.
The strong rises in the March quarter have even led RP Data’s research director Tim Lawless to declare that the market hit the bottom in May last year.
“Since the capital city housing market bottomed out at the end of May last year we have seen dwelling values rise by 4.7 per cent after falling by 7.4 per cent from their market peak back in late 2010.”
Lawless is also bullish about the recovery continuing over the remainder of 2013, pointing to strong private treaty and auction results, less discounting from those selling by private sales and a reduction in the time it takes to sell a property.
“Auction clearance rates haven’t been below 55 per cent on any occasion so far this year, and over recent weeks the capital city weighted average clearance rate has been around the 60 per cent mark with Melbourne and Sydney nudging the 70 per cent mark.”
Ben Skilbeck, the chief executive of Rismark International, which helps compile the RP Data number, points out that investors are leading the charge back into the market; in the 12 months to February, credit growth in the owner-occupier segment was 3.9 per cent, compared with 5.6 per cent in the investor segment.
“With gross capital city unit rental yields now at 4.9 per cent, and a number of short-term fixed-rate loans also being offered at these levels, it’s not surprising to see investors responding to these conditions more quickly than owner-occupiers.”