Investors have officially filled the gap created by first home buyers, new research has found.
According to Australian Property Monitor’s Quarterly Housing Report, Australia recorded solid house price growth over the June quarter as investor activity mitigated the fall in demand from owner occupiers and first home buyers.
Nationally, annual house price growth remained strong – sitting above 15 per cent.
APM’s economist Matthew Bell said the strong results came as a surprise, given the six interest rates rises in recent months.
“Most markets around the country saw modest growth for the quarter, contributing to the continuing high year-on-year figures,” Mr Bell said.
In what was the fifth consecutive quarter of house price rises for Sydney, house prices increased by just over 2 per cent and unit prices were up by almost 3 per cent, pushing annual growth to over 13 per cent – well above the long-term trend.
The current Sydney median house price now sits above $625,000 and the median unit price above $435,000.
Melbourne was another star performer; despite quarterly growth falling to the lowest rate since March 2009, a result of over 4.4 per cent has meant that Melbourne is still a relatively hot market.
Canberra remains the second strongest housing market in the country with the annual rise in median house price coming in at over 16.5 per cent, with the median house price fast approaching $600,000.
“APM expects further price growth moderation in the next three to six months as the low levels of housing finance and the risk of further rate increases weigh on the market. However, the medium-to-long-term outlook for property prices remains strong, and we expect the 2010 annual rate of national house price growth to settle in the eight to 10 per cent range,” said Mr Bell.