A soft landing for australia’s housing market?

Australia’s housing market is weakening, after the Reserve Bank of Australia (RBA) hiked key interest rates to 4.75% in May. The Q4 2010 official data from the Australian Bureau of Statistics (Austats) is widely expected to confirm softening of house prices.

Newspapers, blogs and forums are full of stories of lower sales and diminished homebuyer confidence.

*House prices were up by 4.7% in the capital cities during the year to December 2010, according to research firm Rismark International.

*But house price rises are losing momentum. Home prices in Australia’s eight capital cities rose only 0.4% (seasonally-adjusted) in the three months to December 2010.

*Outside the capital cities, house prices rose only 0.8% during 2010.

Earlier last year, there was an amazing 20% surge of house prices y-o-y to March 2010. This increase triggered an RBA interest rate hike to 4.25% in April 2010, up from 4%.

Source: Global Property Guide