UpHill Newsletter August 2018 (Property prices double every decade?)

POSTED BY Madhawa Hewawasam ON 30 Aug 2018

Property Prices double every decade?


There is a notion that property value in Australia double in every 10 years. Below is an extract from a study conducted to investigate this notion

Home values across the combined capital cities in Australia have increased by a total 72.0% over the 10 years to January 2016 which is short of values doubling over the decade. The value of houses increased by 73.1% compared to units which increased by 64.3% during this period. Melbourne is the only capital city housing market in which home values have doubled over the decade from January 2006 to January 2016, in which the growth in Melbourne was at 100.9%. Second highest growth was in Sydney (78.0%) followed by Darwin (75.3%). The growth in Brisbane for the same period was at 44.0%. 

Property pricing 2006 - 2016


If we compare the data for the 10 year period from January 1996 to January 2006, the combined capital growth in Australia was at 151.7%. Melbourne experienced the second highest growth of 167.7% while Perth with a growth of 175.5% top the charts. The growth in Sydney was at 138.0%, Brisbane 150.3% and Canberra at 148.7%


Property pricing 1996 - 2006

Value growth overall over the five years to January 2016 is 23.2% while value growth in Melbourne for the same period is 23.7%. Given the above data, it is unlikely that by January 2021 rolls around that home values would have doubled over the decade. Sydney and Melbourne are the only capital cities in which values have increased by more than 10% over the past five years to January 2016.

While there has been a decade where home values doubled over 10-year period, and while it is not possible to predict the annual growth rate of a property, data suggest that the property pricing in Melbourne double every 12-18 years*

Source: https://www.corelogic.com.au/news/property-prices-double-every-decade