Residential Property Price Indexes: Eight Capital Cities

Weighted average of the eight capital cities

• fell 1.8% this quarter.
• rose 6.2% over the last twelve months.
   

Capital city Residential Property Price Indexes

• fell in Sydney (-2.2%), Melbourne (-2.3%), Brisbane (-0.9%), Perth (-0.7%), Adelaide (-0.8%), Darwin (-1.4%), and Hobart (-0.4%), and rose in Canberra (+0.8%), this quarter.
• rose in Melbourne (+8.8%), Sydney (+8.1%), Hobart (+6.1%), Canberra (+3.6%), Brisbane (+2.3%) and Adelaide (+0.7%), and fell in Darwin (-2.7%) and Perth (-0.2%), over the last twelve months.
   

• The total value of residential dwellings in Australia fell $98.2b to $7,138.2b this quarter.
• The mean price of residential dwellings fell $12,200 to $678,500.
• The number of residential dwellings rose by 43,800 to 10,520,300.
   

Revisions apply to estimates for the second and third most recent quarters of the total value of dwelling stock (see Revisions, under Total value of dwelling stock, in the Explanatory notes) and to median prices and transfers (see Revisions, under Dwelling transfer counts and median prices, in the Methodology page).

Price indexes published by the Australian Bureau of Statistics (ABS) provide summary measures of the movements in various categories of prices over time. They are published primarily for use in Government economic analysis. Price indexes are also often used in contracts by businesses and government to adjust payments and/or charges to take account of changes in categories of prices (Indexation Clauses).

Use of Price Indexes in Contracts sets out a range of issues that should be taken into account by parties considering including an Indexation Clause in a contract using an ABS published price index.

The effects of COVID-19 saw residential property transactions fall substantially in the eight capital cities during the June 2020 quarter. To overcome this, the ABS introduced imputation methods. For the June 2020 quarter, imputation was used for Hobart and Darwin due to substantial falls in residential property transactions. The movement in each city's house price index was used to impute the movement in its attached dwellings price index.

For further information please see the Spotlight article included in this release: Spotlight - Measuring residential property prices during COVID-19.

The discussion of individual cities is ordered in terms of their significance to the change in the Residential Property Price Index for the latest quarter. The Residential Property Price Index comprises the House Price Index and the Attached Dwellings Price Index.

• The preliminary estimate of the total value of residential dwellings in Australia this quarter was $7,138.2 billion, down from $7,236.4 billion in the March quarter 2020. Of the total value of residential dwellings, $6,815.6 billion was owned by households.
• The number of residential dwellings rose by 43,800 to 10,520,300 and the mean price of residential dwellings fell $12,200 to $678,500 this quarter.
   

• The mean price of residential dwellings in New South Wales ($871,800) remains the highest in the country, followed by Victoria ($736,800) and then the Australian Capital Territory ($699,100). The lowest mean price is in the Northern Territory ($410,100).

The Residential property price indexes (RPPIs) measure price change of the stock of residential dwellings over time. Residential property sales data are used to produce the RPPIs and related statistics. For each capital city, RPPIs are produced by stratifying dwelling transactions by: dwelling type; long term median price; and socio-economic index for areas.

The effects of COVID-19 saw residential property transactions fall substantially in the eight capital cities during the June 2020 quarter. This reduced the number of transactions in most strata. Stratification methods require a sufficient number of transactions to compile the indexes each quarter. To overcome this, the ABS introduced imputation methods.

Donor imputation is used where the number of residential property transactions is extremely low in the quarter and a suitable ‘donor’ series is available for imputation. This approach imputes a price movement from a donor series such as another stratum, dwelling type or city. For example, imputing a movement in the Hobart attached dwellings price index from the movement in the Hobart house price index.

Mean imputation is used where the number of residential property transactions in a stratum is extremely low in the quarter and a suitable donor series is not available for imputation. This approach derives the stratum movement using the average (mean) price movement of all other strata for that dwelling type in that city. For example, imputing a price movement for a particular stratum in the Brisbane house price index using the average price movement of all other strata in the house price index for Brisbane.

Further information about imputation in the residential property price indexes can be found in the linked Methodology page below under How the data is processed.

For the June 2020 quarter, donor imputation was used for Hobart and Darwin due to substantial falls in residential property transactions. The movement in each city's house price index was used to impute the movement in its attached dwellings price index for the June 2020 quarter.

The table below summarises the imputation methods applied to the indexes particularly affected by COVID-19 impacts in the June quarter 2020.

The ABS will continue to monitor residential property transaction numbers to determine if these treatments need to be applied or extended for future quarters.

This release previously used catalogue number 6416.0