This week the Australian Bureau of Statistics (ABS) released its property price index data and confirms there are still strong capital gains trending across Australia.
This data incorporates both detached houses and units – which recorded a 1.8 percent rise in values nationally over the June quarter and a 10.1 percent gain over the year.
Sydney once again drove the growth in property values, with an increase by 3.1 percent for the quarter and 15.6 percent over the year.
Strong growth over the year was also recorded in Melbourne (9.3 percent), Brisbane (6.8 percent), Adelaide (5.6 percent), Hobart (4.3 percent), Perth (3.6 percent), and Darwin (3.4 percent).
Canberra recorded growth of 2.2 percent however this is below-inflation growth.
As well are reporting strong growth in Property Prices, the ABS has estimated the total value of residential properties in Australia has now hit $5.2 trillion for the June quarter.
This has increased from the $5.1 trillion recorded in the March quarter 2014.
The average price of Australia’s 9.37 million residential properties is also $554,800, up 8.8 percent from $509,800 in the June quarter of 2013.
Not only are we seeing strong growth in property prices, but the property market has also seen a 0.1 percent rise in the number of investment housing commitments.
In seasonally adjusted terms the total value of dwelling finance commitments rose 1.0 percent.
The increase in financial commitments for the purchase of property is likely to bring more confidence to the residential construction industry and is supported by the RBA announcing to leave the cash rate at 2.5 percent.
So what does this mean for investors?
There is speculation in the market that the interest rates will rise by mid 2015. Investors should heed this warning and take stock of their home loans.
Now is the perfect time to review your overall debt position, get advice and determine whether you want to hedge you position.