The high price of housing doesn’t seem to be deterring home buyers, with data revealing that national annual house and unit sales have reached their highest levels in four years.
According to RP Data’s Weekly Property Pulse, over the 2013/14 financial year 348,670 houses and 135,330 units were sold. This represented a 10.4% increase in house sales over the year and an 8.6% increase in unit sales.
RP Data senior research analyst Cameron Kusher said, “House sales were at their highest level since the 2007/08 financial year and unit sales were at their highest since the 2009/10 financial year.”
A greater rise in home sales was seen across the capital cities over the financial year than there was at a national level, which Kusher says reflects the stronger demand and capital growth across the main cities.
According to the data, house sales increased by 11.7% over the financial year and unit sales were 7.2% higher. Although, Kusher expects an upwards revision to the unit sales as off-the-plan unit sales are not counted until they settle, and as such a proportion are not included in this analysis.
The lift in transactions has been accompanied by an increase in values across all capital cities. Higher transactions are great for the property industry, says Kusher, while higher values are great for local governments.
“More sales means more commission for agents and brokers, more lending for banks and more business for valuers.
“The combination of higher home values and greater sales is a boon for state and local governments. Stamp duty, which is levied on property transactions, increases as more transactions occur but also as value rise as stamp duty is typically calculated on a sliding scale.”
Looking at the year ahead, Kusher forecasts that the market might start to cool as interest rates possibly rise.
“Looking to the current financial year, interest rates are expected to remain on hold at least to the end of 2014 but potentially starting to rise during 2015.
“Sydney and Melbourne sales volumes appear to have already peaked however, they may rebound once more during spring. Overall we would expect a reasonably high number of sales this financial year however, final numbers may be slightly lower than in 2013/14,” he said.