'Positive signs' for Australian housing market
By James Roberts

'Positive signs' for Australian housing market

The price of residential properties in Australia's state capital cities increased by an average of 1.6 per cent during the past three months, according to the latest figures from the RP Data - Rismark Home Value Index.

Research director at RP Data Tim Lawless highlighted Sydney and Melbourne as two of the markets to watch.

He pointed out that in Sydney capital gains of 1.9 per cent have been recorded in the year to date.

Meanwhile, in Melbourne there has been a rebound in house prices and, although they remain in negative territory, they are only down by 2.6 per cent now, as opposed to the 5.1 per cent decline recorded in May.

Mr Lawless explained that one of the reasons why Australian property has climbed in value is that it has become more affordable.

However, he stressed there are potential hurdles to a full-blown recovery in the country's housing market.

"We know that there is likely to be an increase in new supply over spring, which may introduce some headwinds for a recovering market," Mr Lawless stated.

At the end of last month, president of the Real Estate Institute of Australia Pamela Bennett asserted that issues such as taxation on property transactions, development finance and the planning approval process all need to be tackled to reduce the gap between supply and demand in the Australian housing market.
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