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HOUSE PRICE INDEXES

The price index for established houses covers transactions in detached residential dwellings on their own block of land regardless of age (i.e. including new houses sold as a house/land package as well as second-hand houses). Price changes therefore relate to changes in the total price of dwelling and land.

Project homes are dwellings available for construction on an existing block of land. Price changes relate only to the cost of constructing the dwelling (excluding land).

September quarter 2005 saw the introduction of a new methodology for compiling the established house price index. A detailed discussion of the new methodology is provided in Information Paper: Renovating the Established House Price Index (cat. no. 6417.0) released on 30 November 2005. The new established house price index commenced from March quarter 2002 and has a reference base of 2003-04 = 100.0. A new weighting pattern for the project home price index was introduced in September quarter 2005 (see Explanatory Notes to cat. no. 6416.0).

The price of project homes in Melbourne rose by 0.6% during the June quarter 2007. Preliminary estimates show the price of established homes have risen by 5.0% in Melbourne over the same period. This was the highest quarterly price increase since June quarter 2003. These followed a rise of 0.7% in project homes and a rise of 1.7% in established homes in the previous quarter. The weighted average of the eight capital cities showed a rise of 3.2% in established house prices and 1.1% in project house prices in June quarter 2007.

From the June quarter 2006 to June quarter 2007, established home prices in Melbourne rose by 11.5% while project home prices rose by 1.1%.

HOUSE PRICE INDEXES - Melbourne

HOUSE PRICE INDEXES(a), Melbourne and Weighted Average of Eight Capital Cities
		Melbourne				Weighted Average of 8 Capital Cities
		Established homes(b)		Project homes		Established homes(b)		Project homes
			Per cent change from previous period		Per cent change from previous period		Per cent change from previous period		Per cent change from previous period
		index	%	index	%	index	%	index	%
2004-05		101.9	1.9	103.3	3.3	101.2	1.2	106.1	6.1
2005-06		106.4	4.5	105.9	2.5	105.1	3.8	110.3	4.0
2006-07		116.6	9.5	105.9	-	115.3	9.7	113.3	2.7
2006
	March	106.9	1.4	105.3	-0.9	105.3	1.3	110.4	0.4
	June	110.0	2.9	105.9	0.6	109.3	3.8	111.7	1.2
	September	112.0	1.8	104.2	-1.6	112.0	2.5	111.9	0.2
	December	r114.8	r2.5	105.8	1.5	r114.1	r1.9	112.6	0.6
2007
	March	p116.8	p1.7	106.5	0.7	p115.7	p1.4	113.7	1.0
	June	p122.6	p5.0	107.1	0.6	p119.4	p3.2	114.9	1.1
- nil or rounded to zero (including null cells)
p preliminary figure or series subject to revision
r revised
(a) Base of each index 2003-04 = 100.0.
(b) Estimates for the two most recent quarters are experimental.
Source: House Price Indexes: Eight Capital Cities (cat. no. 6416.0).