The median house price for the Australian capital cities has risen from $160,000 in 1996 to $825,000 today, despite muted growth in the past five years. At the same time, there has been a notable contraction in rental yields.
The Real Estate Institute of Australia says the median house price has risen more than 400% in the past 25 years. This equates to an average annual increase of 6.6% per year. The data shows that over the past five years, the median house price in the capital cities grew 25%, from $683,000 to $825,000, while “other dwellings” rose by 10% to $600,000.
REIA president Adrian Kelly says typical rental yields in the cities have tightened from 5.1% to around 3% over the past 25 years while “other dwellings” have recorded a drop from 5.2.% to 3.7%.Houses in Darwin have the highest rental return, averaging 4.2%. “Melbourne and Sydney have always had the lowest yields, both falling from around 4% in 1996 to just 1.8%,” Kelly says.
The Real Estate Market Facts report found that in the December Quarter the weighted average capital city median price increased 6.0% for houses and by 0.9% for other dwellings.