What a year! It has ended with solid gains in the June quarter. No capital city in Australia turned in negative growth in the June quarter. The growth has been generally so strong that it is only Perth which, while it did put in a strong final run, prior adjustments were too large to be overcome. Brisbane provided the next poorest result with a growth number that is just negative and this number is so marginally negative that it is reasonable to assume it was zero.

While Perth has to year end suffered the largest fall, it is still relatively small and much less than many had predicted. There was a point during the year where the adjustment did reach a little over 11% but the low interest rates and government incentives saved it from a significant downturn. Perth for the moment has thrown off its correction phase. A truly remarkable outcome given the very significant run-up in prices. The following graph presents the position to 30th June 2009.

While in the majority of capital cities, sales activity did fall away, surprisingly sales activity in Perth was actually better than any other capital city, producing growth of a little better than 6%. The cause will be the increased affordability coupled with first home buyers moving from the rental market. The change in the rate of increase in rental costs points to this as demand for rental property has turned down.