Perth prices forge ahead

Darwin's property market went up 3 per cent on the quarter and 17.4 per cent on the year, according to the ABS house price indices for eight capital cities. Hobart, in Tasmania, saw a price increase of 3.4 per cent on the quarter and 9.9 per cent on the year. But in Sydney prices fell by 1.2 per cent in the first quarter of 2006, and by 3.1 per cent over the year to March.

The average for all eight cities was a gain of 1 per cent in january to March, and an annual rate of house price inflation of 3.6 per cent.

Besides Sydney, Brisbane (0 per cent), Canberra (0.2 per cent) and Melbourne (0.8 per cent) did worse than average in the first quarter.

Adelaide prices climed 2.4 per cent in the first quarter and 5.3 per cent over the year.

The figures pre-date Australia’s May interest rate rise which is expected to dampen housing demand.

• ‘House prices in Western Australia are continuing to rise dramatically with home buyers and investors snapping up properties as demand outstrips supply’, the Real Estate Institute of Australia has reported. ‘While the rate of house price growth slowed in the March quarter, median house prices in Perth still rose 5.1 per cent over the quarter to £142,800, and 23.9 per cent over the year. Housing investors are being rewarded with an increase in median rents of 4.5 per cent over the quarter, and vacancy rates of only 1.4 per cent’.

REIA estimates that in the Northern Territory, house prices went up 2.1 per cent in the March quarter to £135,500, and a massive jump of 21.8 per cent compared with the March quarter 2005.

Elsewhere the market is steadier it said, with quarterly growth of 2.2 per cent in Hobart to bring the median house price to £114,300 (a 4.2 per cent increase from March 2005), and growth of 1.9 per cent in Canberra to a median house price of £151,700 (a 2.5 per cent increase over the year).

Sydney was the only market to record a decline in prices over the quarter and the year.

‘Steady growth in the housing market in much of Australia should be maintained although interest rates and petrol prices are having an effect’, said REIA president Tony Brasier. ‘The gentle decline in the Sydney market represents a continuing trend to a more even keel, following the dramatic price rises we saw a few years ago. WA remains in catch-up mode with its booming property prices, although this has also been driven in large part by the booming export market for commodities’.