CAPITAL CITIES COMPARISON



ALL GROUPS CPI

At the All groups level, the CPI rose in all eight capital cities this quarter.

The housing group (+0.6%) is the most significant contributor to the All groups quarterly movement, driven by rises in property rates and charges (+4.6%) in all capital cities. The rise is due to increases in general property rates, emergency services levies and waste management costs. New dwelling purchase by owner-occupiers (+0.7%) recorded a rise as the current prolonged period of low interest rates, combined with strong demand, are putting upward pressure on prices for the construction of new dwellings in a number of capital cities. At the group level, six of the eight capital cities have shown rises with Hobart (+1.9%) and Melbourne (+1.2%) recording the most significant increases. The rise this quarter is partially offset by a fall in electricity (-1.4%), following the Australian Energy Regulator's decision to lower the network charges for electricity distribution for some States and Territories.

The alcohol and tobacco group (+1.3%) is the second most significant positive contributor to the All groups quarterly movement. The rise is driven by rises in tobacco (+2.1%) and beer (+1.5%) across all eight capital cities. The increase in tobacco is mainly due to the effects of the federal excise tax increase effective from 1 September 2015.

The recreation and culture group (+0.8%) is the third most significant positive contributor to the All groups quarterly movement. The rise is driven by international holiday travel and accommodation (+4.6%), which is typical of the peak summer holiday season in Europe and North America.

The most significant negative contributor to the quarterly movement is the communication group (-2.0%) with falls across all capital cities. The fall is driven by telecommunication equipment and services (-2.0%) as competition intensifies among the providers to offer mobile plans with increased data allowance.

Over the last twelve months, the All groups CPI has risen in all eight capital cities with Sydney (+1.9%) recording the largest positive movement. Darwin (+0.4%) has recorded the smallest rise over the last twelve months.

All Groups CPI, All groups index numbers and percentage changes
	Index number(a)	Percentage change
	Sep Qtr 2015	Jun Qtr 2015 to Sep Qtr 2015	Sep Qtr 2014 to Sep Qtr 2015
Sydney	108.6	0.3	1.9
Melbourne	107.6	0.5	1.4
Brisbane	108.1	0.7	1.5
Adelaide	107.1	0.3	1.1
Perth	108.1	0.4	1.1
Hobart	105.7	0.6	1.1
Darwin	108.7	0.4	0.4
Canberra	105.8	0.2	0.6
Weighted average of eight capital cities	108.0	0.5	1.5
(a) Index reference period: 2011-12 = 100.0.

SYDNEY (+0.3%)

The main contributors to the rise in Sydney this quarter are fruit (+9.7%), international holiday travel and accommodation (+4.6%) and new dwelling purchase by owner-occupiers (+1.1%). The Sydney housing market remains strong due to increases in the cost of materials and labour and strong demand, which is putting upward pressure on dwelling construction. The rise is partially offset by falls in vegetables (-8.7%), electricity (-4.5%) and gas and other household fuels (-13.6%). The falls in electricity and gas and other household fuels is due to the Australian Energy Regulator's decision to lower the network charges for electricity and gas distribution, as well as the introduction of a gas rebate for eligible households by the NSW government on 1 July.


MELBOURNE (+0.5%)

The main contributors to the rise in Melbourne this quarter are international holiday travel and accommodation (+4.9%), fruit (+10.9%) and property rates and charges (+5.5%). The rise in property rates and charges is due to an increase in general property rates and the fire services levy. The rise is partially offset by a fall in automotive fuel (-2.7%).


BRISBANE (+0.7%)

The main contributors to the rise in Brisbane this quarter are international holiday travel and accommodation (+5.6%), other financial services (+2.9%) and tobacco (+2.7%). The increase in other financial services is due to a rise in the real estate agent fees over the quarter. The rise is partially offset by a fall in vegetables (-6.8%).


ADELAIDE (+0.3%)

The main contributors to the rise in Adelaide this quarter are international holiday travel and accommodation (+5.3%), tobacco (+2.9%) and property rates and charges (+5.0%). The rise in property rates and charges is due to annual revaluations of property prices and an increase in the emergency services levy. The rise is partially offset by a fall in electricity (-7.7%) following the Australian Energy Regulator's decision to lower network charges for electricity distribution.


PERTH (+0.4%)

The main contributors to the rise in Perth this quarter are electricity (+6.1%), which typically increases on 1 July, motor vehicles (+2.6%) and tobacco (+2.3%). The rise is partially offset by falls in vegetables (-6.0%), telecommunication equipment and services (-2.0%) and rents (-0.9%).


HOBART (+0.6%)

The main contributors to the rise in Hobart this quarter are new dwelling purchase by owner-occupiers (+3.4%), fruit (+16.7%) and international holiday travel and accommodation (+5.3%). The extension of the first home builders grant, low interest rates and increasing dwelling construction activity have put upward pressure on the prices of new dwelling construction, following several years of modest growth. The rise is partially offset by falls in domestic holiday travel and accommodation (-3.1%) and vegetables (-6.1%).


DARWIN (+0.4%)

The main contributor to the rise in Darwin this quarter is domestic holiday travel and accommodation (+12.4%), due to the peak travel season in Darwin. Tobacco (+2.9%) and international holiday travel and accommodation (+5.6%) also recorded rises. The rise is partially offset by falls in accessories (-8.2%) and rents (-1.0%).


CANBERRA (+0.2%)

The main contributors to the rise in Canberra this quarter are property rates and charges (+11.5%), fruit (+12.5%) and international holiday travel and accommodation (+4.4%). The rise in property rates and charges has been impacted by the ACT government tax reform to phase out stamp duty over a number of years. The rise is partially offset by falls in electricity (-4.6%), following the Australian Energy Regulator's decision to lower network charges for electricity distribution, and other financial services (-4.2%), which fell due to the phasing out of stamp duty in the ACT.