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House prices fall in big cities

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  • House prices fall in big cities

    House prices fall in big cities

    By Nicki Bourlioufas
    November 07, 2005
    HOUSE prices fell in most capital cities in the September quarter, except for Darwin and Perth which recorded strong gains, a house price index has revealed.

    Median house prices in Sydney dropped 1.5 per cent over the quarter to $520,000 and were down 4.3 per cent from a year earlier, the biggest annual drop of the capital cities measured, according to the index released today by Australian Property Monitors (APM).

    Sydney recorded the biggest decline for median unit prices, falling by 2.3 per cent to $357,000 in the September quarter, to be down 4.2 per cent over the year.

    Canberra recorded the biggest decline for median house prices in the September Quarter, falling 2.0 per cent to $401,000 from the June Quarter.

    House prices in Sydney are down by 8.9 per cent from the peak recorded on the March Quarter 2004 - the sharpest decline of any of the measured capital cities since the property downturn started in 2004, said Louis Christopher. research director for APM.

    "In terms of prices, the eastern seaboard of Australia continues its downturn," said Mr Christopher.

    "But following the withdrawal of the New South Wales (NSW) vendor stamp duty, sales volumes appear to have risen for the state," he said.

    "While it is early days, this is one positive sign that NSW maybe closer to reaching the bottom of the downturn," said Mr Christopher.

    Mr Christopher predicted the housing market would improve in 2006 if the central bank did not raise interest rates.

    "Assuming interest rates are on hold, we believe that the eastern seaboard market, including Sydney, Melbourne, Canberra and Brisbane, is likely to bottom out sometime in the first half of 2006."

    Darwin recorded the biggest price rise during the September quarter with a 7.9 per cent increase in the median house price to $338,000.

    Reflecting the resources boom, Perth was the only other city to record gains for houses with a rise of 2.4 per cent to $338,000. Perth also had the strongest increase for units, rising by 6.6 per cent in the quarter. The APM house price index has been commissioned by the Reserve Bank of Australia.

    "There's one way to find out if a man is honest-ask him. If he says 'yes,' you know he is a crook." Groucho Marx