Australia's unit markets outperformed houses as property buyers sought out affordable inner city units according to a new data.
The latest figures from RP Data - Rismark Hedonic Home Value Index showed median unit values in Melbourne surged by 6.5% to $421,000 over the three months ending February 2010. This follows a solid 3.8% gain in the previous quarter. On a year-on-year basis, unit values have risen by 20.1%. Houses fared well, but registered a slower growth of 19% over the 12 months to February to $515,000 median value.
Brisbane units racked up 2.2% growth to $379,000 during the February quarter. This compared to just 0.1% rise in median house value to $458,000. Over the year to February, median unit values climbed by 9.1% compared to 6.1% for houses.
Darwin continued to notch up healthy growth with median unit value jumping by 8.4% to $421,000 over the February quarter. On a year-on-year basis, unit values surged by a whopping 32.5%, more than double the house value growth of 15.5%. Darwin has also continued to record the highest gross rental yields at 5.5% for houses and 5.7% for units.
Tim Lawless, Rpdata.com's research director said the continued high rate of capital gains comes as a bit of a surprise.
"Since October we've seen a further 1% added to the cash rate and the boost to the First Home Owners Grant has been completely wound back. It was reasonable to expect that these factors would have dampened market conditions, however this does not yet appear to be the case."
Lawless suggests that these robust market conditions can be largely tied back to the high level of consumer and business confidence across the Australian economy "Consumer confidence in the economy remains well above the long term average thanks to better than expected domestic economic conditions, particularly an unemployment rate that has peaked much earlier and lower than anyone predicted. Such high levels of confidence appear to have reduced the dampening effect of rising rates and the removal of fiscal stimulus," he said.
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