Market/Finance News: Cool and hot pockets of activity

By the resi financial blog team, 12 June 2014

Hot and cold places to buy property in Australia

The latest RP-Data Rismark Home Value Index has highlighted consistent increases in dwelling values over the past 11 months, according to RP Data Head of Research and Analytics Tim Lawless.

However, the index has also noted the first month-on-month decrease, between April and May. 

For first home buyers looking to make the most of the best fixed interest rates available, the slight dip in housing values may help them secure a foot on the property ladder. 

That said, there has been much discussion about whether this slight lull is related to May typically being a weaker month for dwelling value growth, explained Mr Lawless in a June 6 release.

"Generally the month of May is a seasonally weak time for housing markets and no doubt the most recent result suggests that was the case again this year," he noted.

Quarterly growth across the country last peaked in June 2013 and has "trended progressively lower" since, which could indicate a cooling of the property market, according to Mr Lawless.

However, such conditions will relieve those looking to make their move and secure a dream property in the months to come, with lower dwelling values making it easier to climb aboard the real estate train.

Despite the latest findings, it's clear that some areas are still hot property. 

The Real Estate Institute of Victoria (REIV) reported on June 4 that some suburbs are exhibiting very high clearance rates. 

For instance, Melbourne's Vermont South has shown a clearance rate that's close to 97 per cent during 2014 so far. Median house prices have jumped up by 7 per cent in the area over the same period.

In Ashwood, the median house price increased by 4.5 per cent during 2014's first quarter, while Coburg North house prices have soared by an impressive 14.9 per cent between the final quarter of 2013 and the first quarter of this year.

This kind of activity is great news for existing homeowners in the area, who should be pleased by the strong capital growth.

Categories: Home Loans