Posted on Wednesday, February 1st, 2012 in by Matt Garmony
At the end of 2011, the Perth residential property market finished with a positive outlook in an article released by RP Data – Rismark on 30 December indicating “Perth’s house prices jumped by 0.5% in the month of November, leading the first seasonally adjusted increase in capital city house prices since December 2010”, with Australian capital city home values only rising by 0.1%. However on an annual basis, Perth’s home prices were down 3.9% from the previous year. Comments from CommSec chief economist Craig James said “The Reserve Bank’s two interest rate cuts appeared to be having a positive effect”. Craig James stated “The rate cuts will serve to lift demand for homes and drive property prices higher over 2012. CommSec expects Australian property prices to grow around 5% in 2012.”
In an article in the Australian newspaper on 9 January 2012 indicated “Sales of new homes in Australia rose sharply last November, spurred by the central banks easing of interest rates, according to an industry survey published today.” November sales of new homes rose by 6.8% on a seasonally adjusted national basis compared with only 2.8% for October, according to housing industry association Jeldwen monthly report. HIA chief economist Harley Dale stated “There is, however, a long way to go to restore new homes, sales, volumes to acceptable levels” which he indicated a running at least 20% below what you could conservatively call healthy.”
The valuers at Garmony Property Consultants are of the opinion the two recent interest rate cuts have had a positive impact on the lower end of the residential property market with enquiries to selling agents indicating there has been increased activity in the market place with an increase number of homes selling. Although market values have yet to show signs of much of an increase, an increased number of transactions and activity would indicate the market is heading in a more positive direction. In our opinion with further interest rate cuts from the reserve bank and if there are positive signs in the European and American economies, there could be an end to the decline in the property market and 2012 could experience slow but positive growth in market values. If you are thinking of buying or selling a property, we recommend obtaining an independent assessment from the licensed valuers at Garmony Property Consultants for a pre-sale or pre-purchase valuation.