The RpData-Rismark median house price figures for December have been issued today, but we are hesitant to accept them at face value.
Firstly, they have revised the November figures, and significantly so. Perth, for example, was reported last month as -1.2% but this has been revised to +0.3%. That is a massive revision. For December they have issued a figure for Perth of -1.6%, and you have to wonder if that is going to get revised in a similar manner, as our analysis of the Perth market for December would not support such a fall.
In their release, RpData-Rismark themselves advise caution as follows:
“In the generally seasonally weak month of December, the preliminary RP Data-Rismark Home Value Index result for capital city dwelling values was -0.2 per cent (s.a.). Low sales volumes in December mean that this number will likely see a more significant revision than normal.”
“The RP Data-Rismark “rest-of-state” index, which covers Australia’s regional markets, has also revised up in November from +0.3 per cent to +0.5 per cent (s.a.). This is the most significant increase in regional house values since November 2010.”
“Rismark’s managing director Ben Skilbeck said, “The month of December is characterised by a significant lull in activity and the preliminary index results have likely been influenced by some more volatile Melbourne and Perth estimates. We expect to get better clarity on the monthly movements as more information is reported.”
In other words, the amount of data they had for December was insufficient and another significant revision in the data should be expected.
Normally we would provide a city-by-city review of the median prices, but in view of the potential for revision this month, I’m hesitant to report data that may undergo significant change.
But in view of the many press headlines about house price falls, I think a reasoned response is called for. So I’ve taken a look at the data that we can regard as reliable. Firstly, it was apparent that the pace of price falls slowed around July/August 2011 and prices have stabilised in some markets since then. Also, the November rpdata-rismark numbers, having just been revised, represent the most recent reliable numbers.
So I’ve charted the change in median prices between July and November 2011. When rpdata-rismark revise their December figures, we’ll update the analysis.
Here is the graph showing the change in prices over the July to November period:
Over this period, Darwin has changed +1.2%, Perth is unchanged as is Hobart, while Sydney shows -0.2%. The forward trend for 2012 is for Perth and Sydney to show some price rises of 4% and 2% respectively.
Other capitals were still showing falls in prices, with Adelaide -0.7%, Brisbane -1.5%, Canberra -1.7% and Melbourne -2.1%. Propell anticipates that these markets will stabilise over the next quarter or so, as the effects of lower interest rates flow through.