Surprise, surprise – house prices are still on the rise.
The RP Data-Rismark Home Value Index results for March showed over the month, capital city home values rose by 2.3%, with values rising across each capital city.
Over the first quarter of the year, home values were 3.5% higher and year-on-year, values were 10.6% higher.
Although home values across the combined capital cities are rising, the strong growth conditions are largely confined to the Sydney and Melbourne housing markets where values are 15.6% and 11.6% higher over the year respectively, said RP Data.
All other capital cities have recorded annual value growth of less than 5%.
Last week the Reserve Bank decided to keep official interest rates on hold at 2.5%, meaning official interest rates have been unchanged for eight months.
Their minutes said: “Monetary policy remains accommodative. Interest rates are very low and savers continue to look for higher returns in response to low rates on safe instruments. Credit growth is slowly picking up. Dwelling prices have increased significantly over the past year. The decline in the exchange rate from its highs a year ago will assist in achieving balanced growth in the economy, but less so than previously as a result of the rise over the past few months. The exchange rate remains high by historical standards.”
Building approvals data for February released by the Australian Bureau of Statistics shows dwelling approvals fell by 5% in February, however, the trend shows approvals are increasing.
Year-on-year, dwelling approvals are 23.2% higher. Private sector house approvals have increased by 21.8% and private sector unit approvals by 32.8%.
On an annual basis, there were 185,591 dwelling approvals to February 2014 – the highest number of approvals since February 1995.
Over the past year, a record high 44.5% of all dwelling approvals nationally were for units as opposed to houses.
Cash rate hold means variable rates popular
Stop sitting on your hands, RBA: Commentators
Rates still don't budge