Average House Value

Average house values have increased substantly and the average house price in Australia is now being quoted as around $490,000 in January 2010 that is the average price across all of Australia, this include the most expensive suburbs to the cheaper houses in remote country areas.average-house-values

By mid 2008 it was expected the Australian property boom had pretty well had its peak this was the case for many other western economies.

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But during 2009 Sydney continued to stand out as having particularly expensive average or median real estate price compared with other Australian cities.

In 2007 Perth had briefly challenged Sydney for top position in the real estate price league, but since the global financial crisis the Perth market has fallen faster than the Sydney market.

Here is some recent data published on median or average house values

Average house values table (not including units/flats) :

City

Average Price June 2009

Average Price June 2008

Average Price Dec 2007

Average Price Dec 2006

Sydney

$589,731

$542,500

$553,000

$526,000

Perth

$484,904

$496,000

$509,000

$502,000

Melbourne

$472,815

$450,000

$463,000

$366,000

Brisbane

$450,406

$437,000

$425,000

$350,000

Adelaide

$413,330

$416,000

$400,000

$331,000

Hobart

$311,148

$287,000

$280,853

$244,000

Median house values, can of course, mask a large difference in real estate prices between the most desirable and the least desirable areas of cities.

In Melbourne, for example, average house values in the most desirable suburbs, such as Brighton and Canterbury are in the region of $1.25 - 1.5 million. In less sort after suburbs, such as Broadmeadows, the average price is around $250,000, here is an example of the large differences in pricing.

Contributing factors to rising Australian average house value

Two common elements in the countries that experienced rapid average house value increases were increased the access of households to finance, and relatively low interest rates,which reduced the cost of finance.

The latter is true not only for the official interest rates set by central banks, but for longer-term rates set in capital markets. While there has been much discussion about the causes of the low long-term interest rates, With the amount of money that people wanted to save running ahead of the amount that people wanted to invest in physical assets, there was a strong incentive for the financial sector to find ways to issue more financial claims against the stock of existing investment.

All of this is of course, is a recipe for rising asset prices.

The widespread nature of the increases in real estate prices, which as noted,have encompassed most major countries and virtually all parts of Australia, makes it hard to attribute them only to factors which have localised effect – e.g. land usage policies, taxes and transport arrangements.

A big part of the increases over time is due to factors affecting demand and capacity to pay, such as increased household access to finance.

There are many considerations likely to affect real estate prices in Australia.