As 2015 gets underway many investors and first home buyers will be taking stock of the growth their purchases achieved over the last year. The results of the latest edition of the CoreLogic RP Data Home Value Index show some surprising areas of growth and stability. How did your capital city property do in December?
According to the index, capital city properties rose in value by 0.9 per cent for the month to achieve a total capital gain of 7.9 per cent for the year. However, what is most interesting is that some of the quieter cities streaked ahead in the last month of the year, while Sydney, the nation's property hotspot tracked along at the same level for December.
Property for sale in Hobart, Perth and Adelaide was the real draw card in the final throes of 2014, with dwelling values in those cities growing in value by 2.65, 1.92 and 1.81 per cent respectively. Unsurprisingly, Melbourne did quite well for the month and achieved 1.57 per cent, the next highest figure.
Brisbane and the Gold Coast achieved a solid 0.77 per cent increase in values for the month, while real estate in Darwin and Canberra fell by 0.56 and 0.64 respectively
While homes continue to increase in value, the trend is for a more sustainable rate of growth, after the peak in price rises was reached earlier this year.
"The slowing annual growth rate is further evidence that the housing market is losing some steam with combined capital city home values increasing by 9.8 per cent over the 2013 calendar year compared to a more moderate 7.9 per cent increase in 2014," said RP Data Research Analyst, Cameron Kusher.
Mr Kusher went on to note that while house prices are expected to rise in 2015 for capital city real estate, the rate at which they increase is expected to slow down further.
"Affordability hurdles in Sydney, and to a lesser extent in Melbourne, are making it increasingly difficult for some buyers to enter the market. Additionally, low rental yields and the likelihood of tougher lending criteria to investment buyers will likely dampen the very active investor segment of the market which may in turn reduce housing demand in 2015," noted Mr Kusher.
Rental activity is also expected to contract as the effect of increased stock from elevated levels of investment in 2014 is realised. With the data available it looks like 2015 portends a year of affordability for home buyers, with moderate growth for vendors.
