Perth property values have bucked the slight upward national trend, with the median value of houses dipping 1 per cent in the three months to the end of February.
Perth property values have bucked the slight upward national trend, with the median value of houses dipping 1 per cent in the three months to the end of February.
RP Data-Rismark International's national values indices showed Perth as the fourth best performing city after Sydney, Melbourne, and Darwin, which had a top performing 6.1 per cent increase in dwelling values.
It beat Adelaide, Canberra, and Brisbane, the worst performer with a decrease in property values of 2.2 per cent.
Perth property values have plummeted 7.15 per cent since the same time last year, the second largest fall behind Brisbane, which fell 7.18 per cent, compared to a stellar performance in Darwin's property market, which rose 10.72 per cent.
The median price for a family home in Perth was $466,900, down from $468,897 in January.
The most expensive place to live was Sydney, with a median price of $509.900, and the cheapest was Darwin at $413.700.
Meantime, Perth recorded the most expensive units with values averaging $445,370 per dwelling.
Full announcement below.
The release today of the RP Data-Rismark Hedonic Property Value Index heralds some exciting news for the Australian residential market. According to the latest monthly indices, property values are experiencing a recovery from the modest 3 per cent falls seen in 2008. The findings confirmed that over the first two months of 2009, national dwelling values increased by 1.1 per cent with most of the capital gains coming in February (refer attached tables).
RP Data National Research Director Tim Lawless believes this turnaround in market conditions has largely been created by mortgage rates being at their lowest levels since 1970 and as a result, providing a significant boost to affordability. Mortgage rates peaked at 9.6 per cent in August 2008, and have fallen to 5.8 per cent with the prospect of more cuts when the RBA Board meets this coming Tuesday.
According to Christopher Joye, CEO of Rismark International, "The recovery in prices over the last quarter has been driven by the 40 per cent reduction in mortgage rates, the boost to the first home owners grant, the Government's fiscal stimulus and a significant housing shortage. It is now clear that the boost to the first home owners grant has been one of the Government's most successful policy measures - this price strength will hopefully encourage developers back into the market.
"The resilience of Australia's housing market has also been underpinned by our robust banking system, which CBA recently reporting that its 90-day mortgage default rate was a stunningly low 0.38 per cent.
"Despite doomsday rhetoric from some, housing finance volumes have been strong with AFG disclosing that approvals in February 2009 were the best seen since November 2007.
"The improvement in home values in 2009 following modest 3 per cent falls in 2008 highlights the absurdity of the sensationalist predictions by one or two economists in 2008 that prices would fall by 30-40 per cent.
"These index results also vindicate statements last week by the RBA that it expects to see a measured recovery in Australia's residential property market," Mr Joye said.
The latest ABS housing finance data suggests real estate investors have yet to make a return to the property market. The value of investment loans has not been this low since 2002, reflecting the low level of investor confidence across all asset-classes.
RP Data's Mr Lawless suggests the prospect of positively geared property is likely to lure more investors back into the market.
"More and more, properties are showing 'positive cash flow'. In fact, assuming an 80 per cent loan to value ratio home loan and a discounted 5.4 per cent interest rate, investors in apartments are likely to find that rental income goes a long way towards covering mortgage repayments across every capital city.
