Govt grants of as much as A$21,000 given to first-time buyers spur demand
Australian house prices rose in the three months through September for a second quarter as government grants spurred demand among first-time buyers.
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| Paying the price: Residential property prices across Australia rose 8.1% this year through September, Brisbane-based property monitoring company RP Data-Rismark said last Friday |
An index measuring the weighted average of prices for established houses in the eight capital cities climbed 4.2 per cent from the second quarter, when it advanced by the same amount, the Australian Bureau of Statistics said in Sydney yesterday. The median estimate of 18 economists surveyed by Bloomberg News was for a 3 per cent gain.
Concern surging house prices may make Australia vulnerable to a US-style sub-prime crisis was among reasons central bank governor Glenn Stevens raised the benchmark lending rate last month by a quarter percentage point from a half-century low of 3 per cent. Analysts surveyed by Bloomberg News predict Mr Stevens will increase the rate by another quarter point today.
Large gains in ‘house prices when rates are near record lows don’t sit well with a central bank’, Bill Evans, chief economist at Westpac Banking Corp in Sydney, said ahead of yesterday’s report. ‘The pace of price growth will moderate over the immediate short term as demand is checked by rate rises and as first home buyer activity cools,’ Evans added.
Prices rose 6.2 per cent from a year earlier, yesterday’s report said. Continue reading
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