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Sydney value growth 2001-04 vs. current growth

2

Is this a house price boom? Time to recap on 2001, 2004 & today Although Sydney and Melbourne home values are recording strong levels of capital growth currently, the

rate of growth is much slower than that recorded between the ‘boom’ period of 2001 and 2004.

When considering the current surge in Sydney and Melbourne

home values, it is worthwhile revisiting how strong conditions

were during the housing boom of 2001 through to 2004.

Although the rate of capital growth in Sydney and to a lesser

degree Melbourne is strong it is nowhere near as strong as the

rapid home value growth recorded between 2001 and 2004.

At the beginning of 2001 the rate of growth in home values began

to accelerate. The pick-up in value growth began in Sydney and

Melbourne and then flowed through to the other capital cities. A

major difference between the post-2000 growth phase and the

current growth phase is that the post-2000 phase was not

preceded by falls in home values. Another major difference is of

course that the growth post-2000 was broad-based whereas the

current growth in home values has been narrow, largely focussed

on Sydney and Melbourne. Finally household debt levels were

substantially lower in 2001 than they are now, which is likely

another major contributor to the stronger increase in home values

then compared to now.

The previous growth phase is widely accepted to have

commenced at the end of 2000 however, the commencement of

the current rises in values has varied across each city.

Sydney – home values began rising from May-12 and have

increased by 38.8%, over the same period post-2000 they had

risen by 60.2%.

Melbourne – home values began rising from May-12 and have

increased by 23.6% compared to 58.0% over the same period

post-2000.

Brisbane – home values reached a low point in May-12 and have

since increased by 10.9%, in comparison home values had

increased by 91.5% over the same timeframe post-2000.

Adelaide – home values reached a recent low point in Mar-12

and have since increased 7.0%, in the post-2000 growth phase

values had increased by 74.6% over the same timeframe.

Perth – home values started rising from Oct-11 and have risen by

14.5% to Apr-14, over the same timeframe post-2000 home

values had increased by 55.4%.

Hobart – home values reached a low point in Nov-13 and have

increased by 8.9% compared to a 16.7% increase over the same

timeframe after 2000.

Darwin – home values hit a low point in Jan-12 and have since

risen by 17.3%, over the same timeframe post-2000 home values

in the city rose 22.1%.

Canberra – Home values have been rising since the end of Jan-

12 and have increased by 8.5% compared to 96.3% over the

same timeframe post-2000.

The data shows that Sydney and Melbourne are the stand-out

cities for capital growth currently. More importantly, the rate of

capital growth over recent years across each capital city is

significantly lower than over the same timeframe from 2001

onwards. In fact, Hobart and Darwin are the only capital cities in

which the post-2000 level of capital growth is even close to the

current level of capital growth.

CoreLogic RP Data Property Pulse

Monday 01 June, 2015

DISCLAIMER

In compiling this publication, CoreLogic has relied upon information supplied by a number of external sources and CoreLogic does not warrant its accuracy or

completeness. To the full extent allowed by law CoreLogic excludes all liability for any loss or damage suffered by any person or body corporate arising from or in

connection with the supply or use of any part of the information in this publication. CoreLogic recommends that individuals undertake their own research and seek

independent financial advice before making any decisions. © 2014 CoreLogic.

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Base @100

Melbourne value growth 2001-04 vs. current growth

Brisbane value growth 2001-04 vs. current growth

Adelaide value growth 2001-04 vs. current growth

Perth value growth 2001-04 vs. current growth

Hobart value growth 2001-04 vs. current growth

Darwin value growth 2001-04 vs. current growth

Canberra value growth 2001-04 vs. current growth