The Reserve Bank's rate cut has triggered the first rise in home values since December 2010. RP Data-Rismark reported that Australia's capital city home values rose by 0.1 per cent in November, seasonally adjusted. Regional house values recorded a 0.3 per cent rise for the same month. The worst performers have been Brisbane and Melbourne, declining 7 per cent and 5.6 per cent over the year. Sydney and Canberra have been the most resilient with dwelling values falling half a per cent and 1.6 per cent. The research points to a good start for 2012 according to Rismark's director Christopher Joye. It's a change in the right direction.
Those numbers add weight to the Australian Financial Review's prediction that Sydney is expected to be the strongest performer among capital cities this year. A lack of rental properties, strong employment and rising housing demand could push prices up by as much as 8 per cent according to the paper. Investors and first home buyers are expected to buy in Sydney's most affordable areas in the west and south. The higher end market is likely to remain sluggish.
And coastal holiday homes are expected to see values weaken further this summer. Usually it's the best time for coastal agents to sell a property, but this year they'll have their work cut out for them. Holiday buyer confidence is low, with potential buyers preferring to save and reduce their debt. Many high end properties have spent months on the market. 63 Murphy St in Port Douglas has been for sale since August 2010. It was first listed at $4.5 million, and now has an asking price of $3.6 million. The forecast is for further softening in coastal and regional areas with luke-warm demand for lifestyle properties according to RP Data's senior analyst Tim Lawless.
