ABS Q3 house prices rise

The ABS quarterly house price data is out for the September quarter and prices were up 0.3%. The June quarter was revised up from 0.5% to 0.6%. Year on year prices were also up 0.3% . The prior quarter was also revised up from -2.1% revised up -1.9.

Here is the year on year chart:

And the city by city numbers with Perth winning the quarter but Darwin the year:

David Llewellyn-Smith
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Comments

    • Inpex is an effect not a cause. The previous government did more to stuff Darwin (I’d use another term that begins with f and ends in k to more aptly describe the Henderson Government) by strangling land releases to almost nothing than Inpex will ever do.

    • No, prices are not flat, they are slightly negative in real terms.

      Damien Oliver couldn’t have ridden this horse any better. More orange juice all round.

    • Good point Sulli.

      Have a look at mortgage interest rates for the period 1960-2010 here:

      http://macrobusiness.com.au/wp-content/uploads/2011/01/Long-Run-Variable-Mortgage-Interest-Rates.jpg

      Since 2010, the ABS stat tables (F5) tell us that the standard variable interest rate has further dropped to 6.65% as of Oct 2012.

      As the housing market is flat and credit growth is still very subdued despite near 50 year lows in the cost of mortgage debt (except for the GFC emergency period), one can reasonably assume that the housing market is well and truly screwed given it is not responding to the bait in great numbers…

      The likely eventual outcome will be near ZIRP and still deflating house prices in 3-4 years time and a stagnating economy.

      • Very interesting graph.
        I think it is important to point out that, in the period from 1980 to 1989, by law the banks had to charge owner occupiers only 10% interest, while investors were being charged the rates shown in the graph (ranging up to 17%). This was a time when the laws actually favored owner-occupiers over investors (unlike today). Ironically, it also gave a big boost to separated couples. I left high school in 1984 and many of my friends saw their parents separated around that time. The couples who separated ended up more affluent that the ones who stayed together (again, the opposite of what would occur today) because it meant they could buy two houses with 10% interest rate and no CGT.

  1. It’s interesting to note that when prices go uo by 0.3% they are called rises but when they fall by 0.3% or even 1 -2% it’s called flat or stable.

  2. TheRedEconomistMEMBER

    0.3% for Sydney is quite disappointing.

    With a lot of demand brought forward due to the withdrawl of the first home buyers grant on existing property, I would have thought there would have been a larger rise in Q3 2012.

  3. ABS stats seem to show that a lot of the fear about an Australian house price crash/bubble burst has been unwarranted, at least so far.

    Other than Darwin, highly geared new entrants to the capital city markets in the last 4 years might be ahead or behind depending on net grants and timing, financing costs and rental expense, although they are more likely to be behind in Brisbane. In Darwin they are highly likely to be in front.

    Did anyone sell Brisbane and buy Darwin a couple of years ago? Gold star!

    • “a lot of the fear about an Australian house price crash/bubble burst has been unwarranted, at least so far”

      Bit like the bloke who fell off a 20-storey building. As he passed the third floor he said “I’m still fine!”

  4. Deus Forex Machina

    HnH are these nominal prices???

    Just Saw Bloxo on Bloomy saying prices are rising but if these are nominal then well below inflation does it matter???

  5. If the RBA cuts today, it will be repeating the mistake the RBNZ has now so obviously made in allowing the property market to escape its clutches once again. Auckland – record prices, days on market 19. Personally, from an asset traders point of view, I don’t mind…as the carnage that will be wrought on the populations of both countries when whatever it is next that strikes the global markets happens will be profound. A lot of our peoples are going to lose everything that they have, or will ever have.

  6. Steady as she goes. Speculators won’t be attracted by these figures and existing owners will see no need to sell.