Brisbane tops growth in housing prices, up 9.8pc

Financial Review

Brisbane houses prices jumped almost 10 percent in the past six months and the city is expected to show the best price growth over the next five years, according to analysts RP Data and risk mark International.

The RP Data-Rismask Hedonic index, released yesterday, showed a continued recovery in nation is established housing market.

House prices rises for the half-ranged from 9.8 per cent in Brisbane to 9 per cent in Melbourne 8.7 per cent in Adelaide, 3.5 percent Sydney and 1.9 in Perth.

Canberra prices jumped 10 percent but analysts warned of large fluctuations in the nation's capital. Apartment prices rose even further up 18.7 percent in Adelaide,14.7 per cent in Melbourne and 4.4 percent in Sydney "Units are catching up again," said Rismark's head of research, Mathew Hardman.

Dr Hardman said Brisbane had experienced growth right across the metropolitan area, whereas gains in Melbourne and Sydney were confirmed to upmarket inner and coastal strips. "Sydney appears to have officially turned the corner, with consistent growth in house prices of up to 7 percent shown in the inner city, eastern suburbs, lower North Shore and the Northern Beaches," he said. "However house prices in the city's outer metropolitan suburbs and Central Coast continue to stall, with no sign of Growth in the near future."

With the Reserve Bank board meeting next week, the chief executive of RP Data, Graham Mirabito, warned that interest rate rises could stall growth across the whole market. "Brisbane is expected to cope better than any other city," he said. "We expect Brisbane to be Australia's top performing capital city market over the next five years.

The view is shared by forecaster BIS Shrapnel. "Sydney and Brisbane have the most percent-up demand," said BIS Shrapnel managing director Robert Mellor.

"But in a long term sense, Brisbane Prices are 10 to 20 per cent undervalued, whereas Sydney might still be 10 to 15 percent overvalued." "You could easily get annual 6 to 7 per cent house prices growth out of Brisbane over the next four years".