Slowed capital city market growth highlights opportunities for buyers
Anyone looking into securing property across Australia's capital cities could be interested to hear that the latest report from RP Data - Rismark has revealed a slow down in dwelling value increases during April. After exploding during the first months of 2014, the market seems to be simmering down - highlighting a potential opportunity for those interested in buying a property over the coming months.
Dwelling values across Australia's capital cities rose by only 0.3 per cent during April. This comes after a huge 2.3 per cent increase during March and a total of 3.5 per cent during the first three months of the year. RP Data Economist Tim Lawless said the strong conditions were beginning to draw debate about sustainability, as more and more people were getting pushed out of the market by the rising costs.
"The reduction in the rate of capital gains across the combined capital cities housing market brings growth back into a more sustainable range and will be a welcome relief for first home buyers," said Mr Lawless in a May 1 statement.
"A lower rate of capital gains in Sydney and Melbourne where dwelling values surged 22.5 per cent and 16.4 per cent respectively over the current growth cycle, may now signal that these markets are moving through their growth cycle peak."
Adelaide and Brisbane saw the largest growth in dwelling value during April, rising by 2.1 per cent and 1.1 per cent respectively. Following this, Darwin (1.1 per cent), Sydney (0.5 per cent), Perth and Hobart (0.2 per cent) all experienced minor increases on March's values.
Rismark Chief Executive Officer Ben Skilbeck pointed out that this was also the lowest monthly increase for Sydney's property market during it's 11 months of consecutive rises.
"The last time Sydney strung together 11 consecutive month-end increases was in November 2007 when the market added 14.7 per cent and before that in November 2002 when it delivered 19.6 per cent growth," said Mr Rismark in a May 1 statement.
As the market moves towards a more sustainable level of growth, Mr Lawless said this could be great news for interest rates. The Reserve Bank of Australia will have no cause for alarm with the current market's circumstances, which could lead to the cash rate remaining unchanged for the coming months - providing more time for first-home buyers to look into the property market.