SYDNEY Dec 1 Australian home prices rose for
the 11th straight month in November and the annual pace of
growth quickened noticeably, a red flag to policy makers
concerned about the risk of a debt-fuelled bubble.
Property consultant CoreLogic said its index of home prices
for the combined capital cities rose 0.2 percent in November, a
tempering from October's 0.5 percent gain.
However, annual growth in prices accelerated to 9.3 percent,
from 7.5 percent in October, taking it back toward last year's
lofty peaks atop 11 percent.
That will be a worry for the Reserve Bank of Australia (RBA)
which had been hoping the market would cool after regulators
slapped banks with tighter lending rules.
After cutting interest rates to a record low of 1.5 percent
in August, the central bank has sounded reluctant to ease
further in part because it could encourage more borrowing by
already heavily indebted Australian households.
The RBA holds its last policy meeting of the year next week
and is considered almost certain to stay on hold. Financial
markets <0#YIB;> imply only a small chance of another easing
next year as well.
The CoreLogic data showed home prices in Sydney kept up
their blistering run with a rise of 0.8 percent in November,
from October. The annual pace of growth also spurted to 13.1
percent, from 10.6 percent.
Melbourne saw a rare monthly decline of 1.5 percent in
November. Yet annual growth still picked up smartly to 11.3
percent, taking Australia's two largest cities into
Price growth was much more mixed elsewhere, with Brisbane
seeing an annual rise of 3.9 percent and Adelaide 4.7 percent,
but Perth suffering a fall of 3.4 percent.
The market outside the major cities was also far more
subdued, with prices up just 1.4 percent in the year to
CoreLogic's head of research, Tim Lawless, noted the current
national growth cycle had now run for four-and-a-half years
giving a combined capital city price rise of 42.2 percent.
Sydney boasted the biggest gain of 67.3 percent, followed by
Melbourne with 46.3 percent.
The inexorable price rise in the major cities has taken
homes out of the reach of many first-time buyers and become a
political hot potato.
The conservative government of Malcolm Turnbull has blamed a
lack of supply for the problem, while the opposition Labor Party
has pointed the finger at favourable tax treatment for property
(Reporting by Wayne Cole; Editing by Eric Meijer)