RP Data-Rismark Property Index

RP Data Ltd Announcement - 30th November 2007

The latest release of the RP Data-Rismark Hedonic Index shows the Australian property market has stepped up another gear, with national house and unit values increasing by 12.58 per cent over the twelve months ending October 2007. The Index figures show that overall Australian property values have been growing steadily since the start of 2007. Overall Australian growth last quarter was at about the same pace as it has been all year.

Unit prices have increased at a faster rate than house prices, largely due to their greater level of affordability. Over the year ending October '07 unit values across Australia increased by 15.09 per cent to reach $380,088. During the same period, house prices increased by 11.78 per cent with the median value now at $475,803.

Tim Lawless, RP Data's Residential Research Director said "Recent capital gains on home units have exceeded those on houses in many areas as unit prices catch up. Previously, house values had been growing faster than units. It appears that many buyers who previously wanted a house are now settling for home units or townhouses due to the higher degree of affordability these dwellings offer"

The national figures hide a somewhat fragmented performance from the nation's capital cities.

Adelaide continues to be the stand out performer, with house and unit prices increasing by an outstanding 23.89 per cent over the year ending October. Even with such impressive growth, Adelaide prices are still the second lowest of any capital city, with the median dwelling value now at $364,824.

Brisbane was close behind with dwelling values increasing by 19.25 per cent. According to Mr Lawless, "The comparatively affordable properties in Brisbane and South East Queensland, coupled with strong economic growth and immigration have continued to fuel strong and far more uniform growth. We see Brisbane as Australia's best medium term residential property performer, particularly in terms of risk vs return.

Melbourne is the third strongest market, with dwelling prices increasing by 18.39 per cent over the 12 months to October. House are taking just 22 days to sell on average in the Melbourne market, the lowest average marketing time of any capital city.

The Sydney market is continuing to improve, with dwelling prices increasing by 7.38 per cent over the year. While Sydney is well behind most other capital cities in terms of value growth, prices have been improving consistently since January after three years of a depressed market.

The market has continued to slow in Perth and Darwin with dwelling prices increasing by just 5.04 per cent in Perth over the twelve months to October and a healthier 11.55 per cent in Darwin during the same period. Perth house prices have been flat to negative over the past quarter, with upwards pressure from immigration, high wages and savings competing with downwards pressure from unsustainable growth rates.

According to Dr Matthew Hardman, Head of Research with Rismark International, "Perth property dynamics have been strongly correlated with the dynamics of mining sector stocks. There has been uncertainty in both over the past month or two. Investment in Perth property continues to have significant downside risks, being heavily dependent on the continued strong performance of the mining sector and demand from the global economy"

The Canberra market has also slowed after recording an excellent performance during the second half of 2006 and first half of 2007.

Dr Hardman went on to state "Darwin's long and Canberra's short bull runs may be over. This does not necessarily mean prices will fall, however recent data points to lower returns in the near future than in the recent past."

Inner City and metro coastal property markets continue to gather pace while the outer fringe remains comparatively flat

The capital city figures hide a clear delineation between the outer fringe markets and inner city / metro coastal markets that has become even more apparent during October. Generally, inner city and metro coastal locations have recorded impressive growth in property values over the last quarter, while the outer areas of the nation's capital cities have recorded comparatively lackluster price movements.

This trend is most apparent in Sydney where house values in the Inner City, Eastern Suburbs, North Shore and Northern Beaches grew at over 10 per cent in the first nine months of 2007. In comparison the Outer Western and South Western suburbs of Sydney and the Central Coast continue to be under pressure as many buyers suffer mortgage stress and demand continues to fall. Many properties in the West and Central Coast have fallen by more than ten per cent during 2007.

The broadening gap in market performances can be partly attributed to the strong economic conditions and strength of the share market. Dr Hardman commented that "A significant proportion of Sydney homebuyers have received very strong asset and income growth from Australia's strong economy over the past decade. These buyers have not reached borrowing capacity and competition for properties in Sydney's Inner City, North Shore and Northern and Southern Beaches will continue to produce strong growth in these areas, barring a significant external economic event."

Dr Hardman continued "By comparison, many home owners in Sydney's outer suburbs and Central Coast are experiencing significant mortgage stress. The St.George / Sutherland and Canterbury Bankstown areas are starting to also show signs of mortgage stress, contributing to a stalling of price growth. There are currently many properties on the market. However, potential buyers are at the limit of their borrowing capacity. There is simply nothing to push prices up and several reasons for them to fall.

According to Tim Lawless, RP Data's Residential Research Director, "The most divided market over 2007 has been Sydney; however Melbourne is now showing very similar behavior. The affluent areas are experiencing strong growth and the remainder are experiencing relatively flat markets, in some cases negative growth." Hume City and the Yarra Ranges have recorded very flat markets with prices of some properties falling in 2007.

"While mortgage stress is an increasing factor in Melbourne, it is still not as much as in Sydney. Properties in the outer suburbs of Melbourne are still approximately 20 per cent cheaper than their counterparts in Sydney." Mr Lawless said.

* The results are "indicative" only, since they rely on a smaller sample of property sales data and do not reflect the MORE comprehensive sales database used to publish the "final" figures.
* The results are "indicative" only, since they rely on a smaller sample of property sales data and do not reflect the MORE comprehensive sales database used to publish the "final" figures.
* The results are "indicative" only, since they rely on a smaller sample of property sales data and do not reflect the MORE comprehensive sales database used to publish the "final" figures.

The RP Data-Rismark Hedonic Indices benefit from exclusive access to the most comprehensive property database in Australian and NZ, which is owned by RP Data Limited (ASX: RPX). RP Data spends over $9 million annually collecting new property information and has amassed a database comprising over 89 million property data records covering around 98% of all homes. Over 70% of Australian real estate agents subscribe to RP Data's property information services.

In a recent independent review of the RP Data-Rismark Indices, the credit rating agency Moody's concluded "The suite of indexes calculated by RP Data-Rismark represents a significant improvement in the quality of housing price statistics available in Australia." Moody's further commented, "These data are more sophisticated, detailed and have better coverage than that used in the construction of existing housing price indexes in Australia. The high quality of the data makes it possible to implement hedonic indexes, which up to this point had proved difficult to construct in Australia due to data constraints."

For more information on the RP Data-Rismark Indices, please go to http://www.rpdata.com/indices

Background on RP Data

Established in 1991, ASX-listed RP Data (ASX: RPX) is the largest supplier of commercial and residential property information services throughout Australia and New Zealand and is the first and only provider of only provider of hedonic based Property Indices and AVM's. Subscription clients to RP Data's property information service include over 8,500 real estate agents, valuers, property developers, financial institutions and government departments. RP Data is also the largest supplier of property reports to Australians with over 600,000 property reports issued each year. With an annual investment of more than $5 million in databases, RP Data has more than 88 million property data records covering 12 million properties in Australia and New Zealand including ownership records; 12 million property attribute records; 3.6 million property features records; 16 million property sales records; 12 million property maps; 22 million property photos; and 10 million "on the market" property listing records. For more information visit www.rpdata.com.

Background on Rismark International

Rismark is a global real estate investment business that specialises in quantitative research, funding, and securitisation. Rismark is a private company owned by management and a number of leading financial services companies. Rismark has executed exclusive strategic agreements with organisations such as Adelaide Bank, PMI Mortgage Insurance, GFI Group (NASDAQ: GFIG), Wizard Home Loans, RP Data Limited, and others. Rismark's management team has extensive experience in quantitative residential real estate research and is augmented by a Global Research Advisory Board comprising of eminent academics from Sydney University, Melbourne University, and Yale. For more information visit www.rismark.com.au or www.efm.info.