House prices stabilising according to new ABS data
New ABS house price data reveals a combination of increased supply and curbs on investor lending is producing a balanced housing market, according to the Property Council of Australia.
The ABS’s Residential Property Price Index released today showed the weighted average across our eight capital cities rose just 0.2 percent for the December quarter – compared to annual growth of 8.7 percent.
“House price growth continues to pull back – suggesting the delivery of new stock in the market and caps on investor lending are working,” said Glenn Byres, the Property Council’s Chief of Policy and Housing.
“Nationwide growth is moderating. It has now fallen from 4.7 percent in the June 2015 quarter to just 0.2 percent in the December quarter.
“And Sydney – as the market with both our biggest affordability challenge, and the strongest surge in supply – has recorded negative growth for the first time in three years as the index fell 1.6 percent in the December 2015 quarter.
Mr Byres said the industry is seeing record housing commencements, a stable rental market, and stable house prices – and is benefiting from stable interest rates.
“We are seeing benefits of policies that have increased housing supply across Australia. Our concern is that the changes proposed to negative gearing will risk the progress we have made – and this will flow through to investment, jobs and rents.
“Any changes to negative gearing should be seen as a risky and unnecessary intervention at a time when housing markets are more balanced.”