 Property values up during early 2009
House prices in Australia have risen 1.1 per cent in the first two months of 2009, easing fears about the local economy.
This is a welcome sign, as 2008 saw a 3 per cent fall over all in Australian property values.
The RP Data-Rismark Hedonic Property Index
released on Tuesday showed Sydney and Melbourne topped the table with property values up 0.5 per cent to $509,900 and
1.9 per cent to $428,600 respectively. "The recovery in prices over the last quarter
has been driven by the 40 per cent reduction in mortgage rates, the
boost to the first home owners grant, the government's fiscal stimulus
and a significant housing shortage," Rismark International chief,
Christopher Joye, said.
The impressive figures are being attributed by a strong banking system and by lower mortgage rates - which are at their lowest point in
nearly 40 years after peaking at 9.6 per cent in August last year,
before dropping to 5.8 per cent currently.
Increased interest from from home buyers has also helped house prices. Since the boost to the first home owner grant was announced in October last year, real estate agents and mortgage brokers have reported a sharp increase in the number of inquiries from first home buyers.
Economists expert the
Reserve Bank of Australia (RBA) to cut the official cash rate by at
least 25 basis points when the board of the bank meets next Tuesday,
April 7.
The first home buyer grant was increased to $14,000 for those buying an established home and to $21,000 for those building or buying a newly constructed home. This increase is only until June 30 when the grant reverts back to $7,000.
Recently interest rates have also fallen by almost 400 basis points, making housing more affordable for first home buyers.
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