The Housing Industry Association (HIA), representing Australia’s residential building industry reveals that price growth in the residential property segment was moderate in the June 2014 quarter.

Citing figures from the latest update to the ABS Residential Property Price Indexes, HIA Economist Diwa Hopkins said capital city residential property prices grew by 1.7 per cent during the June 2014 quarter, which was slightly faster than in the March quarter, but more modest compared to mid to late 2013, when residential property prices were increasing between 2 and 4 per cent per quarter.

According to Diwa Hopkins, the ABS figures indicate that price growth is easing back to a more sustainable pace. Residential property prices in Sydney continue to grow the most rapidly in both quarterly and annual terms; however, growth rates remain highly divergent across the different capital cities.

Diwa Hopkins comments that steady and sustainable price growth reinforces confidence in the market and is a key ingredient to achieving healthy levels of new home building activity. Housing starts are expected to break through 180,000 in 2014, following nearly 170,000 last year. Continuing improvements in the supply of dwellings will be important in taking some of the momentum out of dwelling price pressures.

Over the June 2014 quarter, residential property prices increased fastest in Sydney (+3.1 per cent), followed by Brisbane (+1.8 per cent), Melbourne (+1.3 per cent), Adelaide (+1.0 per cent), Canberra (+0.8 per cent), Darwin (+0.7 per cent) and Hobart (+0.3 per cent). However, residential property prices declined by 0.3 per cent in Perth in the same period.