Affordable suburbs lead house prices higher
Updated
APM says the lower end of the market out-performed the top end. (ABC News: Giulio Saggin, file photo)
The June quarter report from Australian Property Monitors (APM) shows a rise of almost 2.5 per cent in housing prices nationwide.
APM economist Matthew Bell says the results are surprising as many people had suspected the market was cooling down after six interest rate rises.
Mr Bell says the lower end of the market out-performed the top end.
"The one big change we've had in this quarter is that previously where it's been the more expensive suburbs - the more expensive properties that have been leading the price growth, for the first time in over a year it's been the more affordable suburbs - the less expensive suburbs that have recorded the better price growth," Mr Bell said.
"I guess that's surprising, a lot of people thought that the housing market was cooling - and it is cooling - it's not quite as strong a growth as we saw in the March quarter or the December quarter, but it's still running at pretty high levels and even in a couple of centres like Sydney and Brisbane the quarterly growth rate has increased."
Yesterday's surprisingly soft inflation number has all but ruled out the chance of an interest rate hike next week.
The ABS Consumer Price Index's headline figure rose 0.6 per cent in the June quarter compared with the previous quarter - that was well below the median analyst forecast of a 1 per cent rise.
The relatively modest 0.6 per cent June quarter increase leaves headline inflation at 3.1 per cent for the year to June.
But the two measures of underlying inflation preferred by the Reserve Bank, which take out the most volatile price movements, rose only 0.5 per cent in the quarter.
That meant the rate of underlying inflation was 2.7 per cent for the year to June, well inside the Reserve Bank's 2-3 per cent target band.
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