Melbourne house values at new peak and leading the nation for growth
The RP Data – Rismark Home Value Index for Melbourne houses reached a new nominal peak in January after a surprisingly strong 3.7% rise. The latest figures surpass the previous peak in October 2010.
The unit index recorded a more moderate 0.2% rise and reached an earlier peak in December 2013.
Not only was a new peak reached but Melbourne recorded the strongest growth of all capital cities.
First home buyers are at all time lows; this market is being driven by upgraders and investors in the detached houses market and supported by low interest rates.
With very few auctions in January the rise is also a factor of houses sold through private sale, many of which will have been passed in at auction in December.
This current growth phase is being strongly supported by record low interest rates. Ongoing growth may however be moderated by lower consumer confidence in Melbourne.
It should be noted that the index can show natural volatility on a monthly basis as shown by the rises in September, December and now January against a background of reductions in October and November. However the trend is clear, with rises over the quarter and year.
Robert Larocca is Victorian housing market specialist for RP Data.
