Brisbane has posted the biggest increase in house prices of any Australian capital city, with a rise of 1.5 per cent in August.
The latest RP Data-Rismark home value index shows Brisbane’s median house price has grown by 4.8 per cent in the past year to $429,000.
But the overall pace of growth in Australia’s eight capital cities has slowed to 0.5 per cent, down from 1.6 per cent in July and 1.9 per cent in June.
The median capital-city house price is now $490,000.
RP Data research director Tim Lawless says the result shows prices are growing at a more sustainable level than in the past.
“I think what we’re seeing in August is a seasonally weak month,” he said.
“We are expecting in the Spring season that there will be quite a strong market for Australian properties.”
Median house prices in August
• Sydney: up 0.6 per cent to $587,000.
• Melbourne: up 0.2 per cent to $507,000.
• Brisbane: up 1.5 per cent to $429,000.
• Adelaide: up 0.7 per cent to $380,000.
• Perth: down 0.2 per cent to $499,500.
• Hobart: down 1.9 per cent to $289,000.
• Darwin: up 0.7 per cent to $495,000.
• Canberra: up 0.9 per cent to $503,000.
• Average: up 0.5 per cent to $490,000.
Mr Lawless says the number of investors entering the property market continues to grow.
“The number of finance commitments for investors is up about 20 per cent on the past year,” he said.
“There has been a small increase in the number of first home buyers, but they still only make up 14 per cent to 15 per cent of the entire market. So we are seeing market conditions now being led by investors, secondly by up-graders, with first-home buyers still being a relatively small portion of overall activity.”
The increase in prices came in the same month as the Reserve Bank of Australia cut the official interest rate to a record low of 2.5 per cent.
All of the major lenders lowered the interest they charge variable-rate mortgages in August, making borrowing cheaper than it has been in years.
Perth prices drop, values in Sydney remain highest
The value of homes in Perth fell by 0.2 per cent in August, but is 9.4 per cent higher than during the same month last year.
Its median house price is now $499,500.
Sydney continues to have the highest median house price in the country, growing by 7 per cent in the past year to $587,000.
Hobart is the only capital city to see a year-on-year decline.
The Tasmanian capital’s median house price is now 1.1 per cent lower than a year ago, at $289,000.
Building approvals increase ahead of interest rate decision
The latest official figures show there has also been an increase in the number of new home approvals.
The Australian Bureau of Statistics data shows the overall number of new dwelling approvals, including apartments, climbed by 10.8 per cent in July to 14,304, in seasonally adjusted terms.
The number of new houses approved increased by 3.9 per cent.
Westpac senior economist Matthew Hassan says such a rise is to be expected, given the low-interest rate environment.
“It is pretty much the norm to get a big surge when you’re coming from a weak starting point as interest rates start to generate momentum,” he said.
“I think you can say so far it has been a stop-start recovery. It is certainly a positive situation, but we are not off to the races just yet.”
The Reserve Bank board is expected to leave the official interest rate on hold when it meets tomorrow.