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As another financial year ends let's take a look at how the Australian property market performed over the 2016/17 financial year.
No surprises here, the Sydney property market continued to climb with all dwellings (houses and units) recording capital growth of 12.2%. The previous financial year (2015/16) saw all dwellings growth of 11.3%. This marks the fifth consecutive year of growth for the harbour city. As the market in Sydney is starting to cool, we don’t expect to see continued double digit capital growth remain.
Much like Sydney, Melbourne continued with strong all dwelling growth in the 2016/17 financial year. Values in the cultural epicenter rose by 13.7%, also marking the fifth year of consecutive growth and the largest increase since the 2009/10 financial year.
Adelaide continued its slow and steady growth, notching up another 2.4% all dwelling growth. Adelaide too had its fifth consecutive year of capital growth. The previous financial year (2015/16) saw growth of 2.1% across all dwellings.
The capital of the Apple Isle, Hobart performed strongly in the 2016/17 financial year, increasing all dwelling values by 6.8%. As the tourism sector continues to boom we forecast property growth to continue to follow. Hobart has now seen four financial years of consecutive capital growth.
Canberra has now had six consecutive years of capital growth, ending the 2016/17 financial year up 9.6% across all dwellings. Its strongest rise since the 2009/10 year.
The Sunshine state cooled a little this financial year, ending with all dwelling values increasing by 2%. The 2015/16 year saw an increase of 5.3%. The growth in Brisbane has also increased over the last five years, although the 2015/16 financial year was the slowest rate of growth since the 2012/13 financial year.
Unfortunately, not all capital cities have managed to sustain continued growth. Darwin saw a decrease in all dwelling values dropping by a further -7% in the 2016/17 financial year. This now rounds out three successive years of capital losses.
Perth also recorded an all dwellings capital loss of -1.3% and like Darwin have now had three years of consecutive losses. The downturn in the resource sector has certainly hit hard in Perth and Darwin.
As the policies, the Australian Prudential Regulation Authority (APRA - the governing body that oversees the finance industry) begin to filter through and the measures announced in the last federal budget take effect, we believe the investment property market will slow. This, in turn, should result in lesser gains being recorded in the 2017/18 financial year.
Milk Chocolate was founded seven years ago by Richie Ragel and Michael Cleary, to purchase residential and commercial property in Australia on behalf of our clients, looking for a home or investment property. To see how we can help you get in touch here.
Thanks, Michael
Source: CoreLogic
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