Capital gains slower over September 2014

According to a recent release from RP Data, Housing values eased their way into Spring, with the RP Data CoreLogic Home Value Index posting a only a 0.1% capital gain across the combined capital cities over the month of September. According to RP Data his means that the consumers are getting more sensible when purchasing properties.

Dwelling values across Australia’s capital cities were virtually flat over the month of September according to the RP Data CoreLogic Home Value Index which recorded a 0.1 per cent rise in values over the month.

A 2.9 per cent capital gain over the third quarter of 2014.

The September quarter saw capital city dwelling values rise by 2.9 per cent. According to RP Data national research director Tim Lawless, this was once again driven by exceptionally strong conditions across the Sydney and Melbourne markets where the quarterly capital gain rate was 4.1 per cent and 3.7 per cent respectively.

Additionally, Adelaide recorded a solid increase in values over the September quarter, posting a 3.1 per cent capital gain.

Brisbane (+0.6%), Darwin (+1.4%) and Canberra (+1.4%) also showed a capital gain in dwelling values over the most recent quarter.

Perth (-0.6%) and Hobart (-1.0%) were the only two capital city markets to record a decline in dwelling values over the September quarter.

Other indicators remain strong

Despite the ease in capital gains over September, other indicators remained strong over the first month of spring.

Auction clearance rates continued to beat the 70 per cent mark week-to-week while volumes across RP Data real estate agent and valuation platforms remained strong which indicates heightened levels of industry and mortgage market activity.

“The softer September result is also likely to be seen as a positive indicator by the Reserve Bank which has recently raised concerns about the level of value growth and speculative investing in the Sydney and Melbourne housing markets,” Mr Lawless said.

The high rate of capital gain has sparked further debate around the sustainability of housing markets around Australia, however Mr Lawless, points out that most of Australia’s capital cities are recording a sustainable rate of appreciation.