The price of properties in capital cities across Australia rose at their fastest pace in four years throughout 2013, as low interest rates on mortgages left buyers with an appetite to get themselves onto the property ladder in the country.
Record low costs for house purchase loans across the nation meant that capital city final sale values rose by 9.6 per cent throughout the year, which was the quickest increase at any time since 2009, data published on Thursday (January 2nd) by RP Data-Rismark confirmed.
It said that the year was nicely rounded off for homeowners by the fact that property prices in Australia rose by a combined 1.4 per cent in December. This was driven by the 4.3 per cent growth experienced in Hobart, as well as the 2.2 per cent increase in Melbourne.
On a yearly basis, Sydney recorded the strongest performance of any of the capital cities across the year as a whole. Through 2013, its prices were 14.5 per cent higher than they had been in 2012. In Western Australia, Perth witnessed prices climbing by some 9.9 per cent, while they increased by 8.5 per cent in Melbourne.
“Low interest rates and improved housing affordability have released much of the pent-up buyer demand built up over recent years, with rising prices reinstating the incentive to buy now rather than later,” ANZ analysts Paul Braddick and Dylan Eades said. “Population gains continue to outstrip new home supply and an unprecedented shortage of housing will maintain upward pressure on prices, rents and building activity.”
Growth across the nation came in two distinct halves, with the second six months of the year proving to be far more fruitful for the property market than the first was. Between January and June, prices swelled by just three per cent, comparatively low when held up against the 6.6 per cent increase witnessed in the second part of the year.
However, even though it was a strong year, one analyst said figures were not considered out of the ordinary. “Despite the strongest annual value growth since 2009, the rate of growth was not that startling given the low interest rate environment and the previous successive years in which home values fell,” RP Data’s senior research analyst Cameron Kusher said.
Rises throughout 2013 could be an indicator of what lies ahead for the Australian real-estate market, with The Australian reporting a potential ‘surge’ in the property sector in 2014 thanks to an influx of money to the market from investors taking advantage of continuously low interest levels.