Property Prices In 2009, Australian Capital City property prices performed strongly are expected to continue increasing in 2010. Early signs so far this month indicate that demand from buyers is as strong as it was in late 2009.

In the absence of as many first home buyers in the market in 2010 we expect to continue to see strong demand from the ‘home upgraders’ and also property investors, now that economic conditions have settled down.

Growth over the next 3 years by capital city and median house prices are forecasted to be:

• Adelaide: +23%
• Sydney: +21%
• Melbourne: +19%
• Darwin: +17%
• Brisbane: +15%
• Hobart: +15%
• Perth: +12%
• Canberra: +12%

[source BIS Shrapnel]

Rental Markets
The vacancy rate in each city reflects the level of rental oversupply or deficiency. A vacancy rate of 3.00% in a market is considered balanced, where rents will rise roughly in line with inflation. Due to strong demand and limited supply, vacancy rates are expected remain around 1% to 2% in 2010 which will continue to drive strong rental growth in 2010.


Interest Rates
The cash rate is expected to be raised further during 2010 as consumer and business confidence are improving along with retail spending. The RBA will however, be keeping an eye on signs that the recovery in new construction is sustainable. At 3.75% the cash rate is well below the average cash rate of 4.5% since January 1992. Since January 1992, the cash rate has been changed by the RBA on average approximately three times per year.  Ironically, three 0.25% rises this year would take the cash rate to the long term average of 4.5%.

Your Name Email Address Comment Image Validation Text