Weekly RP Data house price update

By Leith van Onselen

In the week ended 7 March 2013, the RP Data-Rismark 5-city daily dwelling price index, which covers the five major capital city markets, recorded a huge 0.67% increase, which followed last week’s 0.31% increase. This week’s rise was the strongest in well over a year (see next chart).

Value gains were driven by Melbourne, Brisbane and Perth, with only Adelaide recording losses (see next chart).

Over the past 12 months, values have risen by 1.73% at the 5-city level, with all major markets, except Melbourne and Adelaide, experiencing value increases (see next chart).

The next chart plots the daily movements on a 14-day moving average, in order to smooth volatility. As you can see, Sydney, Perth and Brisbane values are in an uptrend. By contrast, Adelaide and Melbourne look to be trending sideways (see next chart).

Values are now down -3.8% since peak at the 5-city level, with Sydney almost recovering all of its lost ground, and Brisbane and Melbourne suffering the greatest losses (see next chart).

However, values have now gained just over half their losses since bottoming in May 2012, with all capitals experiencing a solid rebound (see next chart).

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    • russellsmith55

      I don’t know how long it has to fall to become official, but the trend isn’t looking good for it. My hope is that the falling terms of trade shakes things up gets it going again, but who knows. It hasn’t gotten genuinely affordable enough yet so even if the boom does come back I’ll be sitting it out.

    • Time for the RBA to work out how to choke any boom. Statutory reserve deposits against housing (and other asset classes like shares and commercial real estate) loans at 0% interest is my suggestion. When prices go up to prior peak levels, start with a 5% SRD, when they get to 105% of prior levels, increase the SRD to 10%.

      • Unlikely. Since when has the RBA been in the business of choking a property boom? They have been the great enablers of property booms.

    • Awesome! Ill be happy to sit on the sidelines paying far less in rent and continuing to build my savings while foreigners flip over-priced housing to each other.
      This country has gone down the toilet!

  1. ceteris paribusMEMBER

    Now I know why they built the NBN. So that all younger generations of Australians could “telecommute” to work from their peaceful cottages in provincial and remote regions of the nation.

    • Not as far-fetched as it sounds. With the Australian manufacturing sector dead and mining diagnosed with stage 1 cancer (we all know the sector is going to die but it will take a few years) we’ll be left with a services economy.

      Many services (e.g. financial services) can be delivered from anywhere, providing you have a fast and reliable web connection. Cities will continue to exist (for cultural reasons) but inner ring suburbs will die a slow and painful death.

  2. No CB. We have modern communications and are building the NBN so that useless ‘statistics’ can be propagated like “Brisbane real estate prices rose 1.31% last week”. Why if this keeps up, Brisbane prices, compounding, might double within a year!