It’s been another gloomy year for the Australian property market, marked by falling house prices, fewer sales, mortgage interest rate hikes and real estate jobs heavily slashed. But when compared globally the local market is relatively strong, new research shows.
International house price index, the Global Property Guide, ranks Australia among the world’s top 20 richest real estate spots. Of almost 100 major cities worldwide Sydney now ranks 13th most expensive city to buy an apartment, at around $8838 per square metre, and up from 19th position in 2010.
There were few surprises at the top of the list, which was dominated by the world’s heavy weights including London, New York, Paris and Rome, ranging in price from $9810 (Rome) to $20,654 per square metre (London). But all paled in comparison to the global price pinnacle of $53,612 per square metre needed to secure a home among royalty in the glitzy Mediterranean city of Monte Carlo, Monaco.
At the other end of the price scale, property in the largest city in Tanzania, Dar es Salaam, will set you back $700 per square metre, while Kenya’s capital Nairobi demands $900 per metre. Elsewhere, homebuyers could purchase a plot in the Egyptian capital for just over $1000 per metre, own a property on the Dalmatian Coast for less than $3000 per metre or pitch across the ditch in Auckland for around $4600 per metre, according to the Guide.
Adelaide, Brisbane, Canberra, Darwin, Melbourne, Perth and Tasmania failed to make the list.
Australian cities and statistics
Of the major Australian cities, RP Data shows Canberra had the highest median house price, at $488,000, as at January 2012. Canberra real estate was priced slightly ahead of Sydney at $485,000, followed by Melbourne ($462,500), Darwin and Perth ($450,000), Brisbane ($420,000), Adelaide ($370,000) and Hobart ($328,000). All major city house prices were weaker in 2011 than 2010, with the most significant price drop recorded in Brisbane at 6.8 percent.
Sydney was the only major Australian city to record house price increases in the December quarter, up 0.4 percent, with gains largely due to a spike in demand for houses as buyers rushed in to the market to cash in on the final weeks of stamp duty concessions.
However, the number of homes sold last year was weak, plunging 13 percent from 2010 numbers, which was the equivalent of just two-thirds the total volume of 2007 sales.
How to get a foot on the property ladder
If you’re in the market to buy property, your dream can be achievable with the right planning.
First, you’ll need to create a budget and set some realistic goals – buying in Monaco will be tough with a budget that’s more suited to Tanzania.
Second, do plenty of research into the real estate market – setting some criteria before inspection will help you to avoid being emotional in your purchase. For instance, look for property:
- In or near a capital city
- With good population growth
- At or below the median price for the area
- Which has had solid capital growth in the past but has potential for greater than average growth in the future
- And can be improved with some renovation.
Finally, research should extend to home loan shopping too – compare home loans online for some of the best deals available on the market and don’t be afraid to negotiate if you have an existing lender.