Record low interest rates fuels Sydney Property Bubble

Written by admin on November 4, 2013 – 8:15 pm

Record low interest rates have put a rocket under the Sydney property market, propelling yearly growth to an unsustainable double-digit 11.4 per cent according to official figures released from the Australian Bureau of Statistics (ABS). The size of the Sydney market has helped prop up the rest of Australia, with the weighted average of the eight capital cities returning a frothy 7.6 per cent gain for the 12 months to September.

Canberra and Adelaide is still in the doldrums going backwards 1.2 and 0.6 per cent for the quarter. Perth (0.2%), Darwin (0.4%), Brisbane (1.2%), Hobart (1.4%) and Melbourne (1.9%) reported modest gains, while the red hot exuberant Sydney market fired up a 3.6 percent result and fears of a new bigger property bubble.

Record low interest rates have seen interest payments on dwellings plunge in recent times, creating a false economy as the uneducated leverage back into the property bubble. Few consider the prospect, interest rates could ever rise again.

This has seen an up-tick in the growth of housing finance, after scraping lows not seen since records existed 37 years ago.

All eyes will now be on the Reserve Bank of Australia to see how it intends to react. Will it be forced to follow in the footsteps of the RBNZ and implement macroprudent controls?

» 6416.0 – House Price Indexes: Eight Capital Cities, Sep 2013 – The Australian Bureau of Statistics, 4th November 2013.


Posted in ABS House Price Indices, Australian Housing | 45 Comments »

House prices hit record highs, Interest rates hit record lows.

Written by admin on August 6, 2013 – 7:54 pm

ABS data released today show house prices in Australia has fully recovered, surpassing record highs last achieved in June 2010. The weighted average of the eight capital cites recorded a 2.4 per cent increase to the June 2013 quarter and a healthy 5.1 per cent change for the year to June 2013.

For the quarter, all eight capital cites recorded growth in house prices except Hobart – falling 1 per cent.

Perth lead the gains, recording a 3.4 per cent increase in the quarter, followed by Darwin (2.9 per cent), Sydney (2.7 per cent), Melbourne (2.4 per cent), Brisbane (1.9 per cent), Canberra (1.0 per cent) and Adelaide (0.3 per cent).

Despite a healthy housing market, the Reserve Bank of Australia today dropped interest rates to 2.5 per cent, a record low in Australia. Interest rates might be at record lows, but households and business Australia wide is struggling to make ends meet under crippling high household debt levels and falling consumption, further exposed in recent times by a cooling China and resource sector.

But record low interest rates could now be creating an even bigger housing bubble ultimately leading to severe financial instability when the bubble finally deflates, potentially triggered by rising unemployment or a crisis in China. Yesterday, Roy Morgan Research reported on its latest unemployment survey showing the unemployment rate in Australia is now 10.1 per cent up 0.4 per cent. Another 9% of the workforce is considered underemployed.

The problem of low interest rates fuelling bigger property bubbles is something the Reserve Bank of New Zealand is also struggling with. It needs to drop interest rates to support a cooling economy, but the single interest rate lever leaves the out of control gung ho housing sector leveraging up into even more debt, creating even larger issues long term.

It is expected the RBNZ is about to embark on macroprudential controls including capping the number of high risk low loan-to-value ratio loans as it fears rising property values will create financial instability. Time will tell if Australia is forced to consider similar measures.

» 6416.0 – House Price Indexes: Eight Capital Cities, Jun 2013 – The Australian Bureau of Statistics.

» 48,000 jobs created in July, but unemployment up to 10.1% and under-employment virtually unchanged at 9.0% – Roy Morgan Research, 5th August 2013.

» Analysts fear RBA’s rate cuts could fuel property price bubble – 6th August 2013.


Posted in ABS House Price Indices, Australian economy, Australian Housing, NZ Housing, Unemployment | 44 Comments »

Lower than emergency lows

Written by admin on May 7, 2013 – 7:59 pm

Treasurer Wayne Swan says it is “utterly irresponsible” to call today’s 25 basis point cut to the official cash rate as a cut to “emergency” levels. He is referring to the emergency low 3.00 per cent the cash rate reached after the collapse of Lehman Brothers and at the height of the global financial crisis. So to avoid conflict, we will report the official cash rate now sits at levels “lower than emergency lows”.

As the economy continues to deteriorate, today’s slash to 2.75 per cent is the lowest setting ever announced by the Reserve Bank after it started setting rates in 1990. It is also the lowest cash rate in 53 years. It could be seen as a tipping point.

The media release from the Reserve Bank of Australia states “The exchange rate, on the other hand, has been little changed at a historically high level over the past 18 months, which is unusual given the decline in export prices and interest rates during that time. Moreover, the demand for credit remains, at this point, relatively subdued.”

This time last week, the Reserve Bank of Australia released credit aggregates for March 2013 showing housing finance once again fell to the lowest level since records existed 37 years ago. Monthly housing credit growth now sits at just 0.37 per cent.

Even with interest rates at record lows, the confidence to borrow for a huge mortgage required at today’s mind-boggling prices is close to non-existent. The Reserve Bank will hope today’s cut will turn this around, but it is unlikely to stroke much, if any interest, for buyers to leverage into a bubble.

Today’s rate cut is the first this year. Figures from the Australian Bureau of Statistics (ABS) Australian National Accounts show interest payable on dwellings as a percentage of household net income stood at 5.7 per cent in the last quarter of 2012. Record levels of household debt means it’s still noticeably higher than in 1989 when interest rates where in-excess of 17 per cent.

The ABS today announced official house prices nudged 0.1 per cent higher in the March 2013 quarter, bringing year on year gains to 2.6 per cent.

The move today by the Reserve Bank could also be seen as an attempt to cool the strong Aussie dollar. The Australian Industry Group manufacturing index released last Wednesday shows manufacturing has slumped to a four year low in April under the burden of our defiant dollar.

» Interest rates not at emergency GFC levels: Swan – Yahoo Finance, 7th May 2013.
» Australia Manufacturing Gauge Plunged to Four-Year Low in April – Bloomberg, 1st May 2013.
» Home loan growth stuck at record lows – The ABC, 30th April 2013.


Posted in ABS House Price Indices, Australian economy, Australian Housing | 20 Comments »

Bottom of the housing market, or top?

Written by admin on February 5, 2013 – 6:42 pm

Emergency low interest rates are starting to kindle a fire under Australia’s lethargic housing market prompting vested interests’ to warn we are at the bottom of the housing cycle and on the cusp of a new housing boom, encouraging punters to get in early.

Official data from the Australian Bureau of Statistics (ABS) show house prices in Australia’s eight capital cities rose 1.6 per cent in the December 2012 quarter following a downwards revision of the September 2012 quarter to -0.14 per cent. Last quarter, preliminary data released suggested prices actually rose 0.3% in the September 2012 quarter.

Perth lead the country notching up a 2.9 per cent increase for the three months. Darwin tailed behind at 2.6 per cent, Sydney at 2.3 per cent, and Canberra at 2.1 per cent. Lagging well behind was Adelaide at 0.8 per cent, and Melbourne and Brisbane both recording 0.7 per cent increases. Hobart failed to get out of reverse gear, falling 1.4 per cent for the quarter.

But unless you turn the following graph upside down, it is hard to see a bottom in the market.

In the middle of last year, RBA governor Glenn Stevens said the central bank should not “engineer a return to a housing price boom.”

“As it happens, our judgement is that the risk of re-igniting a boom in borrowing and prices is not very high, and this was a key consideration in decisions to lower interest rates over the past eight months” Mr Stevens said.

Former RBA board member Professor Warwick McKibbin told the AFR today, “I would not personally have cut rates in October or December.”

“It will become increasingly important for the RBA to normalise what are extraordinarily stimulatory interest rates given the striking asset price inflation we are now seeing coupled with the economy’s nominal growth. I would not rule out two hikes before the year is out,” he further explained.

As expected, the RBA decided to leave the cash rate unchanged today citing “During 2012, there was a significant easing in monetary policy. Though the full impact of this will still take further time to become apparent, there are signs that the easier conditions are having some of the expected effects: the demand for some categories of consumer durables has picked up; housing prices have moved higher; there are early indications of a pick-up in dwelling construction; and savers are starting to shift portfolios towards assets offering higher expected returns.”

But the housing market is far from out of the woods yet with many significant risks & challenges remaining. As we reported last week, growth for housing credit in December recorded the worst result ever. This lack of any boom in borrowing should give comfort to Stevens.

While interest rates might be the cheapest they have been in a long time, elevated dwelling prices has caused household debt levels swell to record highs. The net result can be seen in the following graph showing interest payable on dwellings as a percentage of household disposable income. Interest rates might be extremely cheap, but record levels of debt mean Australian households are still forking our more in interest payments on homes today, than in 1989 when interest rates were at the 17 per cent mark.

What do you forecast house asset prices and interest rates to do this year?


Posted in ABS House Price Indices | 4 Comments »

House price decline hibernates for winter

Written by admin on August 1, 2012 – 8:50 pm

If the Australian men’s swimming team can teach you anything at this Olympics, it’s not to be cocky. This turns out to be sound advice considering I was almost certain the Australia Bureau of Statistic’s house price index for Australia’s eight capital cities would have notched up six consecutive quarterly price declines today.

But as a surprise, the index recorded a 0.5 per cent increase for the June quarter 2012. According to the ABS, house prices are back on the rise. This is sure to bring out the sprukers, claiming the bottom of the market.

Darwin took the lead in lane 5, recording a 5.1 per cent increase for the quarter. Sydney scored silver with a 1.4 per cent rise, and Perth took bronze notching up a modest 0.6 per cent rise.

Prices continued to fall in Canberra, Hobart and Melbourne.

While today’s data could be construed as some sign of a recovery, the same can’t be said for housing credit growth currently sitting at the lowest level since records existed 35 years ago. It’s still very early days in the deleveraging process. It’s more likely the house asset price decline in Australia is merely on hold.

» 6416.0 – House Price Indexes: Eight Capital Cities, Jun 2012 – Australian Bureau of Statistics, 1st August 2012.


Posted in ABS House Price Indices, Australian economy | 10 Comments »

RBA slashes rates as Australian housing correction enters full swing

Written by admin on May 1, 2012 – 6:36 pm

Rate cuts by the Reserve Bank of Australia (RBA) in November and December 2011 has done nothing to restore confidence to the housing market with the official Australian Bureau of Statistics (ABS) House Price Indexes released today showing house prices in Australia continue to fall, clocking up five consecutive quarterly price declines. In the March quarter, the weighted average of established house prices in Australia’s eight capital cities fell 1.1 percent and for the twelve months to March, prices have fallen 4.5 percent.

After a bad CPI figure last week, the RBA has slashed the official cash rate today by 50 basis points to 3.75%. Even if the majority of Australian banks choose to pass the cut onto mortgage holders, this cut, like cuts in November and December is expected to provide little to no support to Australia’s housing market buckling under the pressure of high household debt. Just yesterday, the RBA released housing credit statistics showing housing credit growth is at the lowest rate since records started 35 years ago. With housing credit growth this low, Australia’s housing bubble could be on borrowed time.

» 6416.0 – House Price Indexes: Eight Capital Cities, Mar 2012, Australian Bureau of Statistics – 1st May 2012.
» Australian House Prices down 10% from Peak – Steve Keen’s Debtwatch, 1st May 2012.
» Confidence the missing ingredient – The Sydney Morning Herald, 1st May 2012.


Posted in ABS House Price Indices, Australian economy, Australian Housing | 10 Comments »

One down, ten to fifteen to go . . .

Written by admin on February 1, 2012 – 8:47 pm

The latest installment of the official House Price Index from the Australian Bureau of Statistics (ABS) was released today showing Australian house prices continued to fall in the December 2011 quarter. The weighted average of the eight capital cities fell 1.0 percent in December, ending a year where house prices fell in every quarter. For the year, 4.8 percent was wiped of the value of Australian homes.

Brisbane led the falls, slashing 6.7 percent from values. Adelaide, considered one of the more affordable capital cities racked up second place at 6.4 percent.

Assuming there is no further government interference in Australia’s housing market, this years falls is considered to be the start of many in a long period of painful deleveraging. The Economist Magazine reports Australia has one of the largest property bubbles in the world and is overvalued by 53 percent on a rent to price metric. It also believes Australia, Belgium, Canada and France have property markets that are more overvalued today than at the peak of the American housing bubble.

While housing lobby groups in the USA cried a chronic shortage of houses, and central bankers said not to worry – there is no bubble, thus there can’t be a crash, Yale Professor Robert Shiller was raising concern about America’s housing bubble. His real house price index is shown above in blue.

After 5 years and 5 months, the S&P/Case-Shiller Home Price Index for 10 composite cities show house prices have fallen 32.8%.

In Australia (red/orange line), some analysts believe house prices may have bottomed out. On a more serious note, Henry Blodget asked the same question to Robert Shiller about the United States property market while in Davos on the weekend.

Shiller answered, “When people phrase it that way, they say ‘we’ve reached the bottom.’ That suggests that we have the expectation of a major turning point right now. But I don’t see that. I don’t see any reason to think that prices are going to start heading up dramatically now. We do have some good news. Permits are up. Notably, the National Association of Homebuilders Housing Market Index is up and that’s a forward-looking index. But it’s not up very much. If you look at the rate of change it looks dramatic but it’s still at a low level. ”

Blodget suggested property prices in the United States was starting to look like ‘fair’ value relative to long term historic trends (i.e. graph above of real house prices), but Shiller argues what does ‘fair’ value actually mean in an economy like this. Shiller is questioning if America will overshoot. “Now the question is whether we’ll overshoot, which is a common thing that happens after bubble burst.”

As Shiller has looked at bubbles going back hundreds of years, Blodget naturally asked if Shiller has ever seen a bubble where there wasn’t a major overshoot. His reply “Well, the problem is we’ve never had, in the United States, a bubble like this, of this magnitude before. That’s the problem. That’s the fundamental problem of economics.”

But this isn’t a problem limited to America. In Australia, Dr Nigel Stapledon from the University of NSW and former Westpac Bank Chief Economist has compiled real home prices for Australia. In a Morgan Stanley research paper written by Gerald Minack titled “Australian Strategy and Economics : Living in a bubble”, Minack provides the following graph of real median Melbourne house prices dating back further than our graph above.

As you can see, today’s prices are unprecedented in Australia, eclipsing the speculative land boom in Melbourne after the gold rush era (we were digging up stuff then, too) and leading to the Australian Banking Crisis in 1893.

» 6416.0 – House Price Indexes: Eight Capital Cities, Dec 2011 – Australian Bureau of Statistics, 1st February 2012.
» Can’t happen! – cause it’s never happened before! – Who Crashed The Economy, 14th July 2010.
» Housing Bottom? What Are They Thinking? – Business Insider, 29th January 2012.


Posted in ABS House Price Indices, Australian economy, Australian Housing | 19 Comments »

Australian housing correction accelerates into 9th month

Written by admin on November 1, 2011 – 8:43 pm

The September update to Australia’s official house price index was released today showing house prices continue to fall in Australia. The weighted average of the eight capital cities fell 1.2 percent in the last quarter according to the Australian Bureau of Statistics. The ABS also revised down the June quarter originally reported as falling 0.1 percent to a revised figure of 0.5 percent.

Meanwhile, the Reserve Bank of Australia has acknowledged the Australian Economy is no longer as robust and has cut interest rates by 0.25 basis points today. The official cash rate effective tomorrow is 4.5 percent.

While this is expected to bring some relief, figures show the Australian households are still paying close to record interest payments due to large increases in household debt over the past 30 years. Interest payments on dwellings as a percentage of household disposable income has surged since 2001, far exceeding levels in 1989 when the bank standard mortgage rate hit 17 percent.

» 6416.0 – House Price Indexes: Eight Capital Cities, Sep 2011 – The Australian Bureau of Statistics, 1st November 2011.
» Statement by Glenn Stevens, Governor: Monetary Policy Decision – The Reserve Bank of Australia, 1st November 2011.


Posted in ABS House Price Indices, Australian economy | 13 Comments »

Real House Price Index Update

Written by admin on August 5, 2011 – 5:46 pm

Last week, figures from the Reserve Bank of Australia showed home loan credit growth was at its lowest level ever recorded, with RBA records dating back to the 1970′s.

On Tuesday the ABS released the latest quarterly update to 6416.0, House Price Indexes: Eight Capital Cities, Jun 2011.

With extremely poor credit growth for housing, there was no surprise to see continued falls in house prices around the country, as Australia suffers from crippling levels of household debt and the unwinding of the First Home Owners Boost.

A reader has asked if we can update the Real House Price graphs, and with the ABS figures hot of the press it was the perfect time to do so. Our last update was in 2008, and it was scary then.

With our housing bubble once again faltering and GFC2 in kicking distance, we are seeing a surge of newcomers to this site. In this context, we will cover some existing ground and explain what real home prices are.

Real Home prices are simply prices (or an index) corrected for inflation. The U.S. is probably a great example, I’ll show this first :

In this case, the index started in 1890 at 100 and tracks house prices, corrected for inflation and relative to 1890. What you will notice, is the index is relatively flat, that is, house prices today in the USA (after a huge bubble last decade) is not much more than in 1880, in today’s buying power. Assuming wages also tracked inflation, this means an American’s great grand parents paid roughly the same for a house in 1890 than today as a percentage of their income.

But as you can see, it wasn’t always like that. Easy credit and a real estate industry promoting ‘facts’ that house prices double every 7 years and a chronic shortage of homes caused a substantial housing bubble last decade, and when households couldn’t borrow any more to keep the ponzi scheme going, it imploded inwards causing GFC1. This is a good example that ‘a permanently high plateau’ (real estate professional speak) isn’t sustainable.

The data source for U.S. home prices comes from Robert J. Shiller, Professor of Economics at Yale University who wrote the book Irrational Exuberance. He frequently updates the U.S. data and posts it on http://www.irrationalexuberance.com

Now lets turn to Australian real home prices :

Yes, that’s America’s “little” bubble – the blue line down the bottom!

Our bubble continues to aim for the sky thanks to tax incentives such as negative gearing and what seems like bottomless stimulus. You will see a small decline during GFC1 before the Rudd Government introduced the First Home Owners Boost. According to Treasury Minutes, “The short term stimulus [BOOST] was designed to encourage people who had already been saving for a home to bring forward their purchase and prevent the collapse of the housing market.” This may of achieved the government’s short term goal and prevented the collapse of housing bubble in 2008, but it begs the question what is the government’s plans now that the BOOST has finished, and housing is once again falling?

The dataset for Australia comes from two sources. The majority of the data (1880 to 2006) comes from Dr Nigel Stapledon from the University of New South Wales. Prior to 2003, Dr Stapleton was Chief Economist for Westpac Bank. This dataset is continued (orange line) using data from the ABS.


Posted in ABS House Price Indices, Australian economy | 21 Comments »

Down, Down, Prices are Down . .

Written by admin on May 2, 2011 – 10:27 pm

Figures released today from the ABS show house prices in Australia has fallen a larger than expected 1.68 percent in the March quarter, recording the biggest fall since the global financial crisis. Economists had only expected a 0.5 percent fall.

Both Melbourne and Brisbane lead the change in fortune recording a -2.5 percent change. Sydney fell 1.8 percent, followed by Adelaide & Darwin both recording 1 percent falls each. Canberra lost 0.4 percent, while Hobart recorded gains of 0.4 percent and Perth 0.5 percent.

The ABS figures follow a release from RP Data-Rismark on Friday showing capital city house prices fell 2.1 percent across the nation, the biggest fall in 12 years according to their index.

The fall in house prices is not surprising given the fall in mortgage approvals which normally leads the market by about 6 months, and the winding back of government grants used to prop up the unsustainable market the last time it started to dive. Figures from the Reserve Bank of Australia show growth in housing credit is now trickling along at the slowest pace since the start of the RBA records in 1976, some 35 years ago.

» 6416.0 – House Price Indexes: Eight Capital Cities, Mar 2011 – The Australian Bureau of Statistics, 2nd May 2011.
» RP Data-Rismark Hedonic Home Value Index, March Results – RP Data, 30th April 2011.
» Housing loan increase weakest in a generation – The Sydney Morning Herald, 29th April 2011.


Posted in ABS House Price Indices, Australian economy, Australian Housing | 15 Comments »

Australia’s housing asset boom slams on the brakes

Written by admin on November 1, 2010 – 8:09 pm

According to official housing data released today by the Australian Bureau of Statistics, Australia’s Housing Market has slammed on the brakes with five of eight states going into reverse gear.

The weighted average of eight capital cities barely kept its head above water, rising only 0.1% for the September 2010 quarter. This is a dramatic drop from the four and five percent rises per quarter recorded towards the end of last year and into 2010.

The biggest fall in house prices was recorded in Brisbane, falling 2.1 percent over the three month period. Hobart and Adelaide each shared second place with a 1.4 percent fall, while Sydney and Canberra recorded a 0.9 percent and 0.4 percent reversal in fortune respectively.

The quick reversal of consumer confidence towards Australia’s housing market in recent months has caused a surge of experts trying to dismiss the fact that Australia is in the grips of one of the biggest housing bubbles in the world. The Economist magazine has recently reported Australia has the most expensive housing of the twenty countries it monitors, indicating that residential housing in Australia is as much as 63.2 percent overvalued.

Last week it was Westpac’s turn to join the Commonwealth by telling the world that a bubble in Australia’s housing market is a myth, and that we are different. Both the Westpac and Commonwealth banks have the biggest exposure to residential housing loans in Australia.

Westpac chief economist Bill Evans makes the argument that there is no bubble in Australia, because it would have popped by now given the stress placed on it during the global financial crisis. News Limited writes :

Westpac disputes a housing price bubble is being created, saying this would have been highly unlikely to survive the “stress test” of 2008 when prices fell, investor demand slumped and sentiment towards housing was “intensively negative”.

What Mr Evans fails to realise is the massive support the government provided to the market to ensure the bubble didn’t collapse. With mortgage approvals falling 25% to September 2008 and house prices starting to take a dive (see chart above), the Government stepped in and rescued the housing market from imminent collapse by doubling the first home owners grant as part of a $10.4 billion economic stimulus plan.

This recent fall in demand has been attributed to the winding back of the first home buyers grant and stimulus. Last week the Adelaide Sunday Mail reported :

Real Estate Institute president Michael Brock said governments were achieving a false economy by cutting back grants, a major factor in falling first home buyers.

So it appears now that false economies are no longer created by generous housing grants & incentives, but rather the removal of them. Mr Brock’s comments were contained within an article showing the number of first home buyers in South Australia has dropped to its lowest level since 1998.

Mr Evans from the Westpac last week provided further confidence suggesting “With the population boom continuing and particularly strong growth among key first-home buyer age groups, there is significant upside to future housing demand.” Lets just hope the bank is right, or it could get very messy, very quickly. The bigger the bubble – the bigger the fallout.

» 6416.0 – House Price Indexes: Eight Capital Cities, Sep 2010 – The ABS, 1st November 2010.

» Housing bubble a myth, says Westpac – News Limited, 1st November 2010.

» Bye-bye first buys – The Sunday Mail (Adelaide), 24th October 2010.


Posted in ABS House Price Indices, Australian economy, Australian Housing | 7 Comments »

Australian house prices surge out of control

Written by admin on May 3, 2010 – 10:22 pm

The Australian Bureau of Statistics has released their quarterly update to its House Price Index today, showing Australian houses surged an unsustainable 20.0 percent across the eight capital cities in the year to March. This was the largest yearly increase since this index was first created.

Melbourne lead the race to exuberance with a 27.7 percent gain for the year, followed by Sydney with a 21 percent gain. Foreigners such as Chinese and Koreans prefer the high rise atmosphere these two cities provide. But even cities without high rise Chinese demand had spectacular gains, with Adelaide lagging the back of the pack and just scraping in double digit rises of 10.8 percent.

The Reserve Bank of Australia meets tomorrow, and is almost certain to act on this news, raising the Official Cash Rate.

» 6416.0 – House Price Indexes: Eight Capital Cities, Mar 2010 – The Australian Bureau of Statistics, 3rd May 2010.


Posted in ABS House Price Indices, Australian economy, Australian Housing | 22 Comments »

House prices surge to new highs

Written by admin on February 1, 2010 – 4:23 pm

Data from the Australian Bureau of Statistics (ABS) show the prices for houses in Australia has surged in the December quarter. The weighted average for the eight capital cities increased 5.2% for the quarter, bringing the annual gain to 13.6%, once again outstripping wage growth and inflation.

» 6416.0 – House Price Indexes: Eight Capital Cities, Dec 2009 – The Australian Bureau of Statistics, 2nd February 2010.


Posted in ABS House Price Indices, Australian Housing | 2 Comments »

Official figures show Australian house prices continues to fall

Written by admin on February 2, 2009 – 8:49 pm

The ABS released its official House Price Index today for the December 2008 quarter. The Weighted average of eight capital cities fell 0.8% for the quarter, taking the yearly fall to 3.3%.

On the positive, the figures were better than expected. Most economists surveyed expected a 1% fall.

The fall has also slowed for the last quarter suggesting Kevin Rudd’s economic stimulus package providing more generous grants is having an effect. However, unless Rudd can continue to offer them indefinitely, it will appear as just a blip in a falling market.

» 6416.0 – House Price Indexes: Eight Capital Cities, Dec 2008 – ABS, 2nd February 2009.
» House prices fall for third consecutive quarter: ABS – The Australian, 2nd February 2009.


Posted in ABS House Price Indices, Australian economy | 1 Comment »

Australian house prices fall 1.8% : ABS

Written by admin on November 3, 2008 – 10:07 am



The Official House Price Index released by the Australian Bureau of Statistics today show Australian house prices have fallen 1.8% for the September quarter 2008.

The biggest fall was experienced in the Brisbane, with prices heading south by 3.3%. Canberra was just behind at -2.5%, followed by Melbourne -1.9, Sydney -1.8, Perth -1.1 and Adelaide -0.1.

Hobart and Darwin both recorded rises, 0.7% and 0.1% respectively.

» 6416.0 – House Price Indexes: Eight Capital Cities, Sep 2008 – The ABS, 11:30am 3rd November 2008.


Posted in ABS House Price Indices, Australian Housing | 2 Comments »