6416.0 - House Price Indexes: Eight Capital Cities, Mar 2011 Quality Declaration 
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 02/05/2011   
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ANALYSIS


PRELIMINARY:

March Quarter 2011 (-1.7%)

The preliminary price index for established houses for the weighted average of the eight capital cities decreased 1.7% in the March quarter 2011. Through the year to March quarter 2011, the index decreased 0.2%. This was the first through the year decrease since June quarter 2009 (-0.6%).

The negative movement in the March quarter 2011 was the result of decreases in Melbourne (-2.5%), Sydney (-1.8%), Brisbane (-2.5%), Adelaide (-1.0%), Canberra (-0.4%), and Darwin (-1.0%). These decreases were offset by increases in Perth (+0.5%) and Hobart (+0.4%).

The preliminary estimate for Melbourne (-2.5%) was the largest decrease in the index since September quarter 2008 (-3.3%). Median prices decreased in almost all clusters in the March quarter 2011. The movement through the year of 1.1% was a similar rate to June quarter 2009 (+0.8%). In the intervening period, through the year increases had ranged from 9.1% in December quarter 2010 (revised from +10.8%) to 26.3% in March quarter 2010.

The preliminary estimate for Sydney (-1.8%) was the largest decrease in the index since September quarter 2008 (-2.3%). Across the price range in March quarter 2011, median prices in some clusters increased while others decreased. Most of the negative contributions to the capital city quarterly decrease were concentrated in clusters with median prices between $600 000 and $1 500 000. The movement for Sydney through the year to March quarter 2011 (+0.8%) continues the trend of decreasing rates of through the year increases since March quarter 2010 (+19.5%).

The preliminary estimate for Brisbane (-2.5%) was the largest decrease in the index since September quarter 2008 (-3.8%). Some areas of the Brisbane Statistical Division were affected by flooding in January 2011. Some clusters were expected to be impacted more than others, however, median price decreases were observed across almost all clusters. Preliminary data indicates that sales activity decreased in March quarter 2011 across almost all clusters. The through the year decrease of 3.6% was the largest since March quarter 2009 (-4.9%).


REVISED:

December Quarter 2010 (+0.8%)

The price index for established houses for the weighted average of the eight capital cities increased 0.8% in the December quarter 2010. This was revised from a preliminary estimated increase of 0.7%. The through the year movement has been revised from an estimated increase of 5.8% to an estimated increase of 5.0%.

The positive movement in the December quarter 2010 was the result of increases in Melbourne (+2.6%, revised from +1.3%), Sydney (+0.2%, revised from +1.6%), Canberra (+1.6%, revised from +1.9%), Hobart (+2.5%, revised from +1.1%), Adelaide (+0.4%, revised from +1.1%), and Brisbane (+0.1%, revised from +0.7%), and Darwin (+0.4%, revised from 0.0%). These increases were offset by a decrease in Perth (-0.9%, revised from -3.2%).

The preliminary estimate for Melbourne was revised from 1.3% to 2.6%. Across the price range, median prices in almost all clusters increased. Most of the positive contributions to the capital city increase were concentrated in clusters with median prices above $900 000 and below $500 000. The movement through the year to December quarter 2010 was revised from 10.8% to 9.1%.

The quarterly movement in the price index for Sydney was revised from 1.6% to 0.2%. As more data became available, the additional observations for the December quarter 2010 resulted in lower median price increases across some clusters. The movement through the year to December quarter 2010 was revised from 7.4% to 6.0%.

The preliminary estimate for Perth was revised from -3.2% to -0.9%. As more data became available, the additional observations for the December quarter 2010 resulted in increases to median price movements across some clusters. The movement through the year to December quarter 2010 was revised from -2.0% to -0.5%.


FINAL:

September Quarter 2010 (-1.1%)

The movement in the established house price index for the weighted average of the eight capital cities for the September quarter 2010 was revised from a second estimate of -0.3% to a final estimate of -1.1%. The movement in the index through the year to September quarter 2010 was revised from an estimated increase of 10.8% to an increase of 9.9%.

The revision to the second estimate for Melbourne (from +1.0% to -1.8%) was the main contributor to the revision to the weighted average of the eight capital cities second estimate. As noted last quarter, data provision issues impacted on the September quarter 2010 second estimate for Melbourne.

Melbourne (-1.8%, revised from +1.0%), Perth (-2.6%, revised from -1.8%), Brisbane (-1.5%, revised from -1.6%), Sydney (-0.3%, unrevised), Adelaide (-0.3%, revised from -0.9%), and Darwin (-0.5%, unrevised) contributed to the negative movement in the index for September quarter 2010. These decreases were offset by increases in Canberra (+0.3%, revised from +0.2%) and Hobart (+0.1%, revised from +0.3%).