Capital city dwelling values climbed by 3.8 per cent over the 2012/2013 financial year, new research has revealed.
According to statistics provided by RP Data, dwelling values rose 1.9 per cent in June across the RP Data-Rismark eight capital city aggregate index.
RP Data research director Tim Lawless said the June rise has more than reversed the falls recorded over both April and May, when values dipped by 1.7 per cent.
Annually, capital city home values rose by 3.8 per cent throughout the 2012/2013 financial year, which is a significant improvement on the 3.6 per cent fall in values over the 2011/2012 financial year.
According to Mr Lawless, the capital gains recorded over the financial year highlight that lower mortgage rates are starting to have a positive impact on the housing market. However, current conditions are far removed from the buoyant conditions experienced in 2009.
Capital city home values are up by 3.8 per cent over the past 12 months and have now recovered 4.9 per cent of the 7.4 per cent correction.
In comparison, the first 12 months of 2009 saw capital city dwelling values increase by almost 14 per cent.
“At that time, auction clearance rates were at a similar level to what they are now and mortgage rates were lower. However, growth conditions were vastly different,” Mr Lawless said.
The quarter-on-quarter results for June showed capital city dwelling values were up 0.2 per cent, and were largely driven by a strong result in the largest capital city, Sydney. Melbourne and Brisbane recorded a slight fall in dwelling values over the quarter, while the declines in Hobart, Darwin and Canberra were more significant.
“Each capital city housing market excluding Hobart, where values have fallen by 1.8 per cent, has recorded an increase in values over the past year. Annual capital gains have ranged from as little as 0.2 per cent in Adelaide to as much as 6.1 per cent in Darwin and 6.0 per cent in Perth,” he said.
Mr Lawless added that while there has been some natural volatility in the month-to-month readings of the RP Data-Rismark Index, the trend is much more indicative of an ongoing recovery in dwelling values.
“Looking deeper into the index data reveals some interesting trends across the broad price-based segments of the housing market," he said.
“The Sydney premium housing market has gathered some pace since the beginning of the year, likely fuelled by stronger equity market conditions as well as the fact that premium priced housing markets showed a larger correction than other broad-priced segments. Sydney’s most expensive suburbs have seen dwelling values rise by 4.8 per cent over the past six months compared with a 3.2 per cent rise in values at the most affordable end of the market and a 4.6 per cent gain across the broad middle-priced segment of the Sydney market.
“In the other major capitals, the most affordable and broad middle-priced segments of the housing market are typically showing the best value growth. Premium markets are generally showing some appreciation, but still not at the same rate as lower-priced market segments.”