Property values in most Australian capitals have rebounded in June to finish the financial year on a high.
The most recent CoreLogic RP Data report showed the prices of dwellings in capital cities rose by an average of 9.8 percent in the last 12 months, which is close to the 10.1 percent jump seen in the last financial year. Values rose by an average of 2 percent during the June quarter alone.
“The rate of capital gain was slightly higher over the second half of the year (5.1 per cent) compared with the first half (4.5 per cent) highlighting that the housing market has gathered some momentum during 2015,’’ explained Tim Lawless, CoreLogic RP Data’s head of research.
Experts believe that interest rate cuts in February and May could be behind the local property market’s strong performance.
Sydney was the stronger performer in the last financial year with properties up 16.2 percent. It outpaced second place-getter Melbourne, which posted an increase of 10.2 percent.
However, Melbourne’s 2.9 percent growth in the financial year’s final quarter was Australia’s largest. Sydney was close behind with a 2.8 percent increase, well ahead of Hobart (1.8 percent increase), Brisbane (1.7 percent increase), and Adelaide (0.4 percent increase).
Unlike the rest of the nation, which showed strong growth, property prices in the last three months fell by 3.9 percent in Darwin and 0.4 percent in Perth. The downturn in the local resources industries and weakening infrastructure investment is believed to be behind this shift.
While higher property prices may make some investors cautious, CoreLogic RP Data’s research analyst Cameron Kusher believes Sydney and Melbourne property prices should continue to rise in the coming months, but at a slower pace. These east coast capitals are sheltered from the mining sector downturn and buoyed by strong financial service industries.
The message is clear that if you want to invest in Sydney or Melbourne, it’s best not to delay. Contact Chase Edwards today for a free financial health check to learn how you can get the keys to an investment property sooner.