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House prices tread water

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Australian house prices held their ground in February, the latest RP Data/Rismark Hedonic Index has revealed.

According to the Index, Australian capital city values remained flat in February with 0.0 per cent growth, seasonally adjusted.

Rest of state areas, which account for 40 per cent of the market, saw values rise 0.5 per cent.

The results follow a -1.5 per cent decline recorded in January, following the spate of natural disasters experienced over Christmas and the beginning of the year.

According to the Index, over the 12 months to end February, Australian capital city values rose by just 0.8 per cent.

Cameron Kusher, RP Data senior research analyst, said the flat market conditions augured well for investors.

“Auction clearance rates have been a little weak, the number of homes advertised for sale is at the highest level it has been since we started collecting this data, and other lead indicators, such as the time it takes to sell a home, and the margin by which vendors have to discount their properties, are climbing again after reaching a plateau in recent months.

“Conditions are certainly in the favour of prospective investors. The large stock of homes available for sale should afford potential buyers increasing scope to negotiate on price and get the best possible deal.”

Over the 12 months to February Sydney was the lead performer with value growth of 3.3 per cent, followed by Melbourne, Canberra and Adelaide with growth of 2.5, 0.7 and 0.6 per cent respectively.

Brisbane and Perth both experienced declines in value of 5.3 and 4.1 per cent respectively.

Darwin was the weakest performer, according to the Index, with values correcting 9 per cent, following vigorous growth of 20.5 per cent in the two years to December 2010.

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