Interest rate cuts support prices of Australian property

  • 12 years ago
  • Uncategorized

Prices of property in Australia’s
state capitals rose in September 2012 by the largest amount in over two
years.  The latest RP Rismark Home
Values Index found that house prices increased by 1.4 per cent in September –
the largest monthly rise since March 2010.

On a quarterly basis, house
prices in the country’s eight capital cities rose by two per cent.  Experts have attributed the rises to
recent interest rate cuts in the country, as we see next.

Real estate prices in major Australian cities rise in September

The RP Rismark Home Values Index
found that price gains were strongest in Adelaide at 2.4 per cent, followed by
Perth (1.6 per cent), Sydney (1.5 per cent), Melbourne (1.4 per cent) and
Brisbane (1.1 per cent).

The other three capital cities
all saw property prices fall. The value of homes fell by 0.2 per cent in
Hobart, 2 per cent in Darwin and 0.6 per cent in Canberra.

Australian Associated Press
reports that the results suggest ‘the weakness in the housing market from
earlier in the year has since dissipated.’

RP Data research director Tim
Lawless believes that improvements in the property market since mid-year were
linked to the Reserve Bank of Australia’s (RBA) interest rate cuts in May and

He said: “It’s no coincidence
that housing market conditions bottomed out at the end of May, after the
Reserve Bank cut the official cash rate by 50 basis points. A further cut of 25
basis points in June and the anticipation of further rate cuts in the pipeline appear
to have instilled renewed confidence in the housing market which has driven the
growth in home values.”

Rate cuts in Australia have helped to
stabilise the country’s housing markets and many of the major locations are now
seeing rising prices.

And, I expect house prices in
Australia to continue to rise over the next few months.

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Author Nick

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