The outlook for home values in 2014 is looking positive with last year’s figures showing a 9.8 per cent increase over the 12 months to December.
The RP Data-Rismark results show that across Australia’s capital cities there was a 1.4 per cent rise in December and a 2.8 per cent rise in dwelling values over the final quarter.
Cameron Kusher of RP Data says the results from the December Hedonic Home Value Index show the fastest annual rate of value growth since August 2010, and the largest calendar year increase in values since 2009 when home values were up by 13.7 per cent.
However, Kusher was quick to point out the increase was not overly significant when considering the long-term data.
“Despite the strongest annual value growth since 2009, the rate of growth was not that startling given the low interest rate environment and the previous successive years in which home values fell,” Kusher says.
“Although home values increased by 9.8 per cent in 2013 the growth follows a 3.8 per cent annual fall in values in 2011 and a further 0.4 per cent annual fall in 2012. Cumulatively, from peak to trough, capital city dwelling values were down 7.7 per cent prior to this current growth cycle.”
According to Kusher, although value growth has been strong compared to recent years, the current growth cycle has been somewhat muted.
Overview of figures:
Best performing capital city: Sydney +4.1 per cent
Weakest performing capital city: Canberra, -1.3 per cent
Highest rental yields: Darwin houses with gross rental yield of six per cent and Darwin Units at 6.2 per cent
Lowest rental yields: Melbourne houses with gross rental yield of 3.4 per cent and Melbourne units at 4.2 per cent
Most expensive city: Sydney with a median dwelling price of $655,250
Most affordable city: Hobart with a median dwelling price of $330,000
Reproduced in full with permission: Australian Property Investor Australian house prices continue to rise 2 January 2014
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