Australian Residential Property Prices Remain Stable During February
The price of Australia residential property remained stable during February as interest rate hikes towards the end of last year took some of the fizz out of the market.
According to the RP Data Rismark index, home prices in cities across the nation were unchanged in February after falling by a seasonally adjusted and revised 1.5 per cent in January, the biggest such decline since the index began tracking prices in 2005.
“When you consider that Australian inflation was 2.7 per cent in the year to December 2010, in real terms Australian residential property values have been declining, which is a good outcome for prospective buyers,” said RP Data senior research analyst Cameron Kusher.
The update from the property research groups noted: “A (near) double interest rate hike in November 2010 combined with numerous natural disasters has conspired to make the last three months difficult ones for Australia’s housing market.”
The central bank began hiking interest rates in 2010, making borrowing more expensive. The Reserve Bank will once again meet next Tuesday to decide the future course of interest rates, with the market pricing in a 7 per cent probability that the central bank will respond to instability in the Middle East, and the European sovereign debt crisis, with a cut in interest rates.
Prices of residential properties in Melbourne declined by 1.8 per cent during the quarter ending February, whilst Sydney prices inched up by 0.3 per cent over the same period according to RP Data-Rismark. During the same time frame, prices in flood stricken Brisbane experienced a decline of 3.3 per cent, whilst prices in Perth declined by a seasonally adjusted 1.9 per cent.
The national city median dwelling price in February was $459,000, RP Data said.
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