Recent fluctuations in capital growth rates in residential property in Australia indicate the likelihood of large falls in the market has decreased, according to the PR Data Rismark National Residential Property Value survey.
However, this projection is contingent on a “stable interest rate environment, which is likely to result in a static rate of growth”, head of research Matthew Hardman said.
The May survey found the housing market was experiencing a “higher level of volatility from quarter to quarter” along with all asset classes, he said.
Capital growth in the key housing markets of Sydney and Melbourne was found to have had “flattened considerably during 2008, in particular, but the recent return of volatility indicates this pattern may be coming to an end”.
Hardman is “confident that the supply side imbalance in the national housing market will see further property value increases over the next five years”.
“We expect low levels of housing supply to continue placing upward pressure on housing prices over the long term,” he said.
