http://www.news.com.au/money/property/disasters-knock-property-market/story-e6fr...

    * House values fall across nation
    * Disasters keep consumers sidelined
    * Housing affordability slumps

HOMEBUYERS are deserting the property market in the wake of recent natural disasters with latest figures showing the biggest monthly slide on record.

The weather crises in Queensland, New South Wales and Victoria in December and January have kept home buyers sidelined, with property values slipping across the nation.

The RP Data-Rismark Home Value Index for capital city dwellings dropped 1.6 per cent (seasonally adjusted) in January, while regional residences lost 1.2 per cent of their value.

It's the biggest monthly slide in Australian property sales ever, according to RP Data.

Canberra was hardest hit  with prices slipping 3.8 per cent, followed by Perth at 2.6 per cent and Brisbane 2.3 per cent.

RP Data's information will be used by the Reserve Bank of Australia when it meets tomorrow to discuss the possibility of raising the nation's official cash rate.


The index previously reported a 0.4 per cent capital gain for the month of December, which has been revised slightly to 0.3 per cent with the addition of further sales data.

RP Data research analyst Cameron Kusher said market conditions are typically flat in January because of the holiday period but the natural disasters had made it even worse.

"It’s the biggest fall in values that we’ve ever seen on a monthly basis so while we’re not pressing the alarm bells yet we will wait and see what the February results actually tell us," Mr Kusher said.

"We expect it will be revised up slightly,  we don’t expect the February result to be nearly as bad as January as clearance rates are improving and there are other indicators suggesting a better outlook."

While the natural disasters occurred in three states, its impact on the property market had spread across the nation, Mr Kusher said.

"The disasters kept people out of the market,  particularly in Brisbane," Mr Kusher said.

"But it also impacted on potential buyers in other states because they holiday in Queensland or they have family and friends there."

More broadly, over the 12 months to the end of January, the index reported that home values in Perth had fallen 3.8 per cent, the biggest drop nationwide, followed by Brisbane (-3.7 per cent) and Canberra (-0.6 per cent).

At the other end of the spectrum Darwin has regained the title of the best performing city, recording a capital gain of 4.7 per cent over the year to end January.

This was followed by Melbourne (3.6 per cent), Sydney (2.5 per cent), Hobart (2.2 per cent), and Adelaide (2.0 per cent).

Meanwhile, housing affordability slumped 10 per cent during 2010 as a result of four interest rate rises, compounding an already dwindling supply of new homes, a housing lobby group says.

The Housing Industry Association (HIA)/Commonwealth Bank housing affordability index released today fell by a further 1.8 per cent in the December quarter.

Housing affordability dropped 5.5 per cent in Sydney in the December quarter, followed by a 3.4 per cent decline in Canberra and a 3.4 per cent fall in Adelaide.

Affordability improved modestly in Brisbane and Perth, rising 0.5 per cent and 0.1 per cent respectively.
Outside the capital cities, in the non-metropolitan regions of NSW affordability rose 2.8 per cent, followed by a 1.3 per cent increase in Victoria.

But affordability deteriorated in Tasmania (down 3.8 per cent) and Western Australia (down 2 per cent).

HIA chief economist Harley Dale said housing affordability took a big hit during 2010, with interest rate increases in March, April, May and November behind the decline.

Economists are unanimous in excepting no change in rates tomorrow but Dr Dale said governments needed to "up the ante'' on delivering policy reform to tackle a range of supply-side constraints, including the lack of affordable land and the dire shortage of available credit for commercially viable residential projects.

A down trend in residential construction over nearly a decade is obviously tied to a downward trajectory in housing affordability, he said.

look like the money has gone out and not much left .. that's why they hurry with so many taxes .. in such cases .. you won't see a bright picture in the future ahead ... a diving in home price is also possible ..

now it's good time to sell ..

pansi you playing the doom and gloom game that rusty loves..

he will be beside himself with glee over this new if it turns out to be true.. he hates homeowners,

I remember the last doom and gloom news regarding housing its didnt happen though did it?..

the house prices were inflated by your govents stimulus and you guys know it...gees who in their right mind would knock back $21000 FHB.

now I understand it they are stopping the lot..even the $7000. did you hear that??.. if thats the cse then it will be a turn down in the building of new homes and make what already there worth more surely?

Lisa Jones wrote on Mar 1^st, 2011 at 1:13pm:


Please Lisa,
Don't get into huge debt right now.
Consider buying down market a little instead.

cods wrote on Mar 1^st, 2011 at 1:09pm:


you are a complete ignoramus as usual.

tell me who likes to pay more than they should for anything ?? why should property be any different than any other commodity !!

tell me who likes to pay more than they should for anything ?? why should property be any different than any other commodity !!

- Last Nail

Well said. I thought it was all common sense though lol

Lisa Jones wrote on Mar 1^st, 2011 at 1:55pm:


to most people who have a brain it is common sense but to some others on this board it really must be a struggle for them LOL