It’s not out of the question for property market history to be created in 2018 with Australia’s first legitimate capital city candidate to produce 20 per cent property price growth for the first time in 11 years.
The last capital city to push through the 20 per cent threshold in a single year was Darwin (22.2 per cent) in 2007.
In fact, in spite of Darwin’s recent woes, the Top End has produced double-digit price growth more times than any other Australian capital city since the turn of this century – 10 times, the last being 12.1 per cent in the 2012 calendar year.
After price growth of 9.8 per cent in 2016 and 12.3 per cent in 2017 (the highest in Australia), Greater-Hobart is currently the run-away hottest property market in Australia. It was the only capital city to produce positive price growth during the March quarter and there’s no end in sight.
Metropolitan-Hobart is currently experiencing price growth of 16 per cent.
With a similar population size as Geelong and Wollongong, Hobart is Australia’s eleventh largest city – not that size is a prerequisite for price growth.
With buyer demand being driven by the state’s strong economy, high local confidence, housing affordability, and extremely tight housing supply, Hobart just might push through the 20% price growth milestone in the 2018 calendar year.
Looking back over history, the 5-year period ending 2007 was an extremely prosperous era for Australian real estate, particularly in large parts of regional Australia where there were multiple locations that saw property prices double in only 5 years [refer below chart].
Capital cities also performed well in 2007, with every capital city other than Sydney producing double-digit price growth.
In 2002, 7 out of 8 capitals produced double-digit growth and then all 8 capitals did it again in 2003.
As for that 20 per cent per year milestone, Sydney last broke it in 2002 (22.9 per cent), Brisbane (22 per cent) and Hobart (32 per cent) last did it in 2004, and Adelaide’s median house price increased by 21.5 per cent in 2003.
Over in the west, Perth had consecutive years of in excess of 20 per cent in 2005 and 2006.
Canberra also had back-to-back years in 2002 and 2003.
Melbourne came close in 2001 (19 per cent) and 2007 (18.2 per cent).
During the recent Sydney and Melbourne boom, the highest rates of growth were 15.5% and 13.7%, respectively. Both occurred in the 2016 calendar year.
But it’s never always rosy. We only look back to 2011 when 8 out of 8 capital cities declined in value. 5 out of 8 declined again in 2012.
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