Excessive yearly falls in sales listings
Excessive yearly falls in sales listings
Posted on Monday, July 06 2015 at 12:36 PM
The number of Australian residential property sale listings fell in all capital cities during the month of June, according to SQM Research, with falls in Sydney and Melbourne larger than expected for this time of year.
Nationally, the number of listed properties fell to 335,971 in June
2015, falling 6.5 per cent from May 2015, with the number of listings down 3.2
per cent from a year earlier.
Once again Sydney and Melbourne recorded the heaviest monthly change, as
a result bringing the national average down.
Year-on-year results indicate that Melbourne, Sydney and to a lesser
extent Hobart, experienced excessive yearly falls.
Melbourne recorded the biggest yearly change, with listings falling by
20.2 per cent, reducing the number of properties for sale to 34,498. Sydney
soon followed with listings down 15.7 per cent from this time last year. Hobart
recorded a yearly change of 8.4 per cent.
Managing director of SQM Research Louis Christopher says: “While
the national result is only down marginally from levels recorded this time last
year, the Sydney and Melbourne result clearly reveals the ongoing boom in these
two cities.
“We have not seen Sydney with so
few listings and Melbourne’s stock is now being quickly absorbed. Potential
vendors in these two cities are holding back on selling their property in the
hope (and fear) that the market is going to rise from here.
“And with this type of squeeze on
the market, prices will indeed most likely rise from here.”
SQM Research figures show that asking prices for Sydney houses continued
to climb over June, with a total monthly rise of 2.8 per cent. The median
asking price for a house has now reached $1,120,700 while the median unit in
Sydney dropped over June and is now advertised at $615,400.
In contrast, median asking house prices in Darwin continue to fall with
year-on-year comparison showing a 12-month decline of 2.4 per cent for houses
and 8.4 per cent for units. Perth also recorded yearly falls, with asking
prices for houses down 3.6 per cent and 1.0 per cent for units.
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RBA keeps cash rate at same level
RBA keeps cash rate at same level
Posted on Tuesday, July 07 2015 at 2:38 PM
Just as predicted by the 33 experts and economists surveyed by finder.com.au, the Reserve Bank of Australia (RBA) announced this afternoon that the cash rate will be staying at two per cent for at least another month.
Governor Glenn Stevens said
in his announcement: “The Board today judged that leaving the cash rate unchanged was
appropriate. Information on economic and financial conditions to be received
over the period ahead will inform the Board’s assessment of the outlook and
hence whether the current stance of policy will most effectively foster
sustainable growth and inflation consistent with the target.”
Domain senior economist
Andrew Wilson was unsurprised by the announcement. He said: “House price growth, particularly in Sydney
and Melbourne, will continue to be fuelled by the lowest mortgage rates since
the mid-1960s. Low bank deposit rates will also continue to activate investment
in residential property chasing both higher yields and capital gains.”
According to the
finder.com.au survey, many of the experts surveyed cited reasons for a rate pause including the RBA continuing to maintain a
‘wait and see’ approach as the recent rate cut in May has had little impact as
yet on the economy.
The improved unemployment
rate, higher housing costs as well as financial pressures from overseas were said
to be other factors associated with the decision.
However, almost two out of
five of the experts surveyed (38 percent or 12 experts) are expecting the cash
rate to fall by the end of the year, which could be as early as next month. Of
the 12 who expect the cash rate will fall this year, five are expecting a drop
in August or September while the remaining seven are expecting to see the cash
rate fall in the last quarter of 2015.
Two experts are forecasting
the cash rate will rise this year – Peter Boehm from onthehouse.com.au and Mark
Crosby of the Melbourne Business School.
Griffith University’s Mark Brimble said before the decision: “The Reserve Bank is between a rock
and a hard place on this now, with a weak economy and property prices starting
to bubble in some areas. Ideally, it needs the currency to do the work for it,
but this is remaining stubbornly strong.
“This continued uncertainty in Europe and Asia and expectations of a
rate rise in the US later this calendar year, the Reserve Bank is likely to sit
on its hands. Regarding house prices, the property market will continue to
behave unevenly across the country. Some areas will continue to rise, while
others will fall dramatically as employment (and thus demand) shifts.”
Michelle Hutchison, money
expert at finder.com.au, says
first homebuyers will see greater pressure to enter the market if interest
rates fall further this year.
“The latest global economic
uncertainty has thrown a spanner in the works for our local economy, as the
Reserve Bank could now look to minimise the impact by reducing the cash rate
this year.
“This could lead to further
pressure on the housing market, as lower interest rates could fuel further
demand for investors and refinancers, leaving first homebuyers behind.”
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‘Property Value’ tool hits the market
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‘Property Value’ tool hits the market
Posted on Friday, July 03 2015 at 12:47 PM
As announced in this month’s Australian Property Investor magazine (which is on sale now, folks!), property data and research company CoreLogic RP Data has today launched its new consumer property information website Property Value (www.propertyvalue.com.au).
Described as an “all-you-can-eat
data buffet”, it’s set to help homebuyers, sellers and investors achieve an
active reading of a property’s performance as well as deliver updates on
current market conditions prior to a purchase or sale.
The website and tool, which
comprises both free and subscription-based elements, was created in response to
an increasing demand from everyday buyers and investors.
“It’s our hope Property Value
will help Australians make more informed and better property decisions and
ultimately put them in a better financial position,” CoreLogic RP Data head of
solutions Greg Dickason says.
The site provides extensive data
coverage and decision-making tools and also works on mobile. Every day buyers
and sellers can estimate the sale value of a property and take a much deeper
dive into data before deciding on which property to buy and where, by using the
benchmarking option, and analyse comparable properties for sale, for rent and
recently sold. Users can even look back over 30 years to see what the property
has previously sold for, how long it’s generally taken to sell and whether it’s
been rented.
Investors are also provided with
a unique estimated rent and yield for individual properties in addition to “Investor
Scores”, which score a property and its surrounding suburb in relation to cash
flow, capital growth and lower risk investment strategies.
It’s not just about individual
property, though. Each street and suburb has its own profile – giving further
insight into the surrounding areas. If a buyer’s considering a couple of
suburbs, these can be compared side-by-side using the “compare” function. Users
can also check out the make-up of the street they’re interested in, including
how many units and houses there are and whether they’re likely to be rented or
owner-occupied.
In a nutshell, then, Property
Value helps investors to:
- Understand what a property
might be worth by comparing its estimated market value with comparable recent
sales - Perform due diligence on
investment opportunities - Locate capital growth
information for states, cities, suburbs, streets and individual houses - Easily find auction clearance
rates - Identify vendor discount rates,
rental yields, vacancy rates and demographic information.
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Calls for commission to consider retirees
Calls for commission to consider retirees
Posted on Wednesday, July 01 2015 at 11:21 AM
Calls have been made by executive chairman of Raine Horne Angus Raine for the Greater Sydney Commission (established in last week’s NSW Budget) to help promote more suitable housing for retirees, such as low-density apartment blocks and villas, in order to help address the city’s real estate affordability issues.
The NSW Government will invest $20.9 million
over four years to launch the Greater Sydney Commission, which has been given
the task of overseeing the delivery of new housing, infrastructure and
services, across the metropolitan area.
To help meet its target of 664,000 dwellings in
Greater Sydney by 2031, the state government has allocated $400 million to
support new housing supply in infill and greenfield areas, as well as $89.1
million to help cut council red tape.
“The Greater Sydney Commission is an excellent
initiative but it must find ways to deliver suitable housing to retirees still
living in oversized family homes across the metropolitan area,” Raine says, adding
that he believes Sydney requires more medium-density housing and villas, where
land prices make this a feasible alternative for developers.
“There’s been plenty of news about the massive
growth in apartment developments across Sydney, but the majority of this stock
isn’t suitable for retirees, who are already hampered by the prospect of paying
stamp duty to downsize.
“If the commission can help encourage more
Sydney empty-nesters to downsize out of bigger family homes, it will go some
way towards helping to address the city’s affordability issues,” he says.
Raine also urges the NSW Government to do more
to promote the benefits of downsizing to a bigger population centre such as
Newcastle, Bathurst, Wagga, Tamworth, Dubbo and Orange.
“These centres offer all the amenities and
facilities that retirees have come to expect in the city, yet real estate
prices are significantly more affordable,” he says.
In the St George and Sutherland Shire region,
Ray Fadel, principal of Raine Horne Sans Souci, agrees that the explosion
of high-rise apartment towers in his region is not really addressing the
housing needs of empty-nesters.
“Older Australians want to live in villas or
three-bedroom apartments in smaller blocks that have views and are within
walking distance of shops and transport,” he says.
“There’s not much stock like that in our region
apart from Cronulla, Ramsgate and Brighton.
“The majority of the new developments in the St
George/Sutherland region offer two-bedroom apartments, located in high-rise
towers where owners must share the space with hundreds of other occupants.
“Even though they all have lift access, the high-rise
towers are not for retirees in many cases.”
Older three-bedroom villas worth around $1
million are proving popular with retirees, although they’re also in short
supply, according to Fadel.
“The trouble is that the three-bedroom villas
were selling for about $700,000 a few years ago. They’re now up above $1
million, which doesn’t free up much cash for retirees considering a downsizing
strategy,” he says.
On the North Shore, Hugh Macfarlan, principal of Raine Horne
Chatswood/Willoughby, says the cost of land generally prohibits the development
of villas.
“Ku-ring-gai
Municipality, which covers off suburbs between Wahroonga in the north and
Roseville in the south, has responded with plenty of new low-rise apartment
blocks that offer stylish three-bedroom apartments with generous floor plans
and lifts, which are suitable for downsizers,” he says.
“These
apartments are more manageable than large houses on big blocks with tennis
courts and pools, that many on the Upper North Shore continue to live in because
of a shortage of suitable options.
“Stamp
duty is already a problem and this is keeping many older North Shore residents
in bigger homes, so it would be great to see the new Greater Sydney Commission
consider ways to address housing affordability issues – and this probably means
encouraging the development of larger quality apartments close to good
amenities that would suit downsizers very well.”
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Renters in the north, movers in the south
Renters in the north, movers in the south
Posted on Friday, June 26 2015 at 1:59 PM
While a third of Australians are currently renting property, a new Nielsen report from Domain.com.au has revealed that the Northern Territory has the highest percentage of renters in the country (43 per cent), followed by Queensland (37 per cent).
Though the Sydney and Melbourne property markets are
the most talked-about in the country, the percentage of people renting in these
states is significantly lower, with more renters in NSW (33 per cent) than in
Victoria (28 per cent). Tasmania has the lowest percentage of renters in the
country, with just a fifth (20 per cent) of the state currently
renting.
The Domain data suggests that renting is a temporary
state, highlighting that 47 per cent of Australians have lived in their current
rental property for less than two years. Only 27 per cent of Australians have
been in their rental property for more than five years.
The “great Australian dream” of homeownership is
seemingly distant for some states, with 62 per cent of NT residents indicating
they believe that owning their own home is no longer attainable. More than
half (51 per cent) of NSW and Vic (52 per cent) residents are also negative about
the attainability of property ownership.
Domain senior economist Andrew Wilson says the high
number of renters in the NT reflects low homeownership rates.
“High housing costs in the NT remain a significant
barrier to home ownership resulting in the highest proportion of renters to
total households of all Australian states.
“Darwin house prices are behind only Sydney of all the
state capitals, and although Territory incomes are the among the country’s
highest, local rents are clearly the highest, providing another significant
barrier to home ownership for those saving for a deposit.
“That said, the number of recent new developments in
the NT means we may see a shift in the future. Supply is slowly catching up to
demand and we may see a gradual increase in the rate of homeownership.”
Meanwhile, the state of Victoria has recorded its
highest net interstate migration in more than 40 years, figures released by the
Australian Bureau of Statistics
(ABS) have revealed. Denise Carlton from the ABS says
the latest figures
from Australian Demographic Statistics, December Quarter
2014, reflect
an ongoing trend of increasing population growth for
Victoria.
“Victoria has experienced increasing population growth
since 2011, with a net gain of 9,300 people from the rest of Australia in the
last year alone.
“Most of this increase for Victoria can be attributed
to people moving from NSW (2,700 movers), with South Australia (2,100), Western
Australia (1,400) and Queensland (1,100) the next largest contributors.
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NSW Gov promises $400m boost to help housing affordability
Posted on Monday, June 22 2015 at 10:32 AM
Last week’s New South Wales State Budget will inject a record $400 million into the Housing Acceleration Fund (HAF) in order to speed up the delivery of more housing and put downward pressure on home prices, according to a government spokesperson.
Visiting a site for new homes in Sydney’s northwest,
NSW Premier Mike Baird, Treasurer Gladys Berejiklian and Minister for Planning
Rob Stokes said the largest-ever single contribution to the HAF will ensure
faster land releases across Sydney.
“This record investment will help put the dream of
home ownership within reach of more young families,” Baird said.
“One of the most important things we can do to
improve housing affordability is to increase housing supply.
“We’ve increased housing supply to the highest
levels in two decades – and we’re delivering the vital infrastructure needed to
support this new housing.”
The $400 million boost will take total HAF funding
to $966 million since 2012.
So far the HAF has been allocated for
infrastructure projects supporting 161,000 new dwellings and 1,200 hectares of
employment lands and it’s expected this new funding will at least double that
number.
This round of the HAF will include a focus on
projects that enable and facilitate increased housing in existing areas, and
will include projects that help facilitate new housing investment while
improving the infrastructure and amenity of existing areas.
The HAF has already funded key infrastructure
projects supporting new housing including upgrades to Camden Valley Way,
Richmond Road and Schofields Road in Western Sydney.
So far this financial year, about 7,750 of the NSW
Government’s First Home Owner Grants have been issued – an increase of 9.2 per
cent over the corresponding period last year.
Berejiklian said: “We know that housing
affordability is a very big issue for a lot of
people, and this record funding will help to put
downward pressure on prices.
“The grants we’ve issued to first homebuyers are
working to assist people across our community to get the keys to their new
home.”
Stokes said: “The Cudgegong
Road Station precinct… will be a thriving new community in close proximity to
the first station on Sydney’s new modern, world-class metro rail system.
“On top of being a terrific place to live and
having great public transport services, the precinct will also feature parks,
sporting fields and retail space for new shops, restaurants and cafes.”
The new station precinct is being prepared for
construction of more than 4,500 new homes. People will be able to buy into the
area within two years.
It sits directly opposite The Ponds, which will
have more than 4,200 dwellings when the final home is completed at the end of
the year.
Sydney’s northwest is forecast to have more than
70,000 homes built within the next three decades.
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Government’s looking to the north
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Government’s looking to the north
Posted on Friday, June 19 2015 at 4:40 PM
The Australian Government yesterday released its White Paper on Developing Northern Australia: Our North, Our Future, the country’s first White Paper on developing northern Australia, describing it as “an essential part of our plan for a strong, prosperous economy and a safe, secure Australia”.
With a land mass covering more than three million
square kilometres and a population of more than one million people, the north
has been largely ignored in the past, despite being home to some of Australia’s
most treasured icons, such as the Great Barrier Reef, Uluru and Kakadu.
The paper sets out a long-term reform agenda up to
2035, delivering an initial investment of $1.2 billion (in addition to the $5
billion Northern Australia Infrastructure Facility).
Measures to unlock the north’s potential across six
key areas include: simpler land arrangements to support investment; developing
the north’s water resources; growing the north as a business, trade and
investment gateway; investing in infrastructure to lower business and household
costs; reducing barriers to employing people; and improving governance.
The government says it is supporting simpler and
more secure land arrangements in the north, by investing:
- $20.4 million to support native title bodies to
realise their potential and negotiate more efficiently with business; - $17 million to support secure property rights for
cadastral surveys, area mapping and township leases; - $10.6 million for pilot land tenure reforms to
help fund ‘next steps’ for projects that demonstrate the benefits of tenure
reform, particularly on pastoral leases.
It will also work with the Council of Australian Governments
(COAG) to:
- reduce native title costs and delays – the
Government wants all existing native title claims settled in the next 10 years;
and - allow Indigenous Australians to borrow against or
lease out exclusive native title land.
A $200 million Water Infrastructure Development
Fund is set to be established, which will provide up to $5 million for a
feasibility analysis for the Nullinga Dam near Cairns, and up to $5 million for
a detailed examination of land-use suitability for Ord Stage 3.
In order to help attract more investors to the
north, the government plans to:
- host a major northern investment forum in Darwin
in late 2015 to bring together international investors, supported by the new
investment prospectus: “Northern Australia emerging opportunities in an
advanced economy” - set up a new $75 million Cooperative Research
Centre on Developing Northern Australia; - invest $15.3 million to position the north as a
global leader in tropical health; - provide $12.4 million for Indigenous Ranger
groups to expand biosecurity surveillance; - help business enter new markets and supply chains
by increasing access to the Entrepreneurs’ Infrastructure Programme and
Industry Skills Fund.
The government also says it will focus on funding
high priority infrastructure through a $5 billion Northern Australia
Infrastructure Facility; a new $600 million roads package; and a $100 million
beef roads fund, which will help improve cattle supply chains. Plans are also
afoot to invest $5 million in rail freight analyses, starting with a
pre-feasibility analyses of the Mount Isa to Tennant Creek railway and an
upgrade of the Townsville to Mount Isa line.
The Northern Australia Strategic Partnership — the
biannual gathering of First Ministers from the Commonwealth and northern
jurisdictions — will also be made permanent.
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Study shows FHB investors least well off
Study shows FHB investors least well off
Posted on Tuesday, June 16 2015 at 2:00 PM
A new study by comparison website Finder.com.au has found that first homebuyer investors are the least well off in the Australian property market despite being in a better financial position.
The survey of more than 1,100 Australians
found that 14 per cent of recent or prospective first homebuyers (FHBs) are
buying their first home as an investment. Generation Y (aged 18-34) are more
likely to be FHB investors than any other age group, with 64 per cent of FHB investors
from that category, followed by gen-X (aged 35-54) with 33 per cent.
These FHB investors are more likely to
have a bigger household income than owner-occupier FHB – almost double the
proportion have a household income of more than $200,000 (17 per cent) compared
to FHB owner-occupiers (9 per cent). More than half of first-time buyer
investors (59 per cent) have a household income of $100,000 or more, compared
to 46 per cent of FHB owner-occupiers.
The study found that purchase budgets are
also bigger for FHB investors, as 52 per cent are spending more than $500,000
compared to just 35 per cent of FHB owner-occupiers. More FHB investors have a
budget higher than $1 million compared to FHB owner-occupiers, too.
First homebuyer investors are less likely
to buy their first property in the same city in which they live (79 per cent)
compared with FHB owner-occupiers (91 per cent). Forty-eight per cent of FHB investors
are likely to buy apartments, townhouses and villas compared to just 36 per
cent of owner-occupiers.
Michelle Hutchison, money expert at finder.com.au,
said despite deeper pockets than owner-occupied FHB, FHB investors are finding
it the toughest in the property market.
“First homebuyers are among the lowest
levels we’ve ever seen, currently at just over 15 per cent of all home loans
financed, and it has been steadily declining for over a year.
“Government grants for FHBs have declined
while property prices have grown considerably over the past few years. And now
with some lenders pulling back on their attractive rates to investors, first-time
buyer investors are the worst off.
“However, this is good news for FHB
owner-occupiers, who are the majority of FHBs, as it could help alleviate the
property market heat, which is being pushed by investors and refinancers.
“Whether you’re buying your first home to
live in or as an investment, prospective borrowers need to be careful with
over-stretching themselves as it’s not worth the financial risk if you can’t
afford to jump into the market. Work out how much you can afford to repay with
a buffer for rising interest rates and stick to a budget or face financial
stress down the track.”
Capital city results
- Sydney has the highest number of FHB
investors, followed by Melbourne and Perth, while Adelaide has the least - Sydney FHB investors are more
likely to have a budget over $500,000 than FHB investors in other capital
cities, while Adelaide were the least likely - Perth and Brisbane FHBs are the
least likely to have a budget over $1 million, while Sydney and Melbourne were
the only cities to have FHB investors with property budgets of over $1 million - Sydney FHB investors
were more likely to have a household income of more than $100,000, followed by
Melbourne, than Perth. The least likely is Adelaide.
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Brisbane’s softer median mostly seasonal
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Brisbane’s softer median mostly seasonal
Posted on Wednesday, June 10 2015 at 4:39 PM
A 3.3 per cent fall in Brisbane’s median house value was seasonal and expected according to the Real Estate Institute of Queensland’s (REIQ).
The group’s Queensland Market Monitor reveals the median house
price fell to $580,000 in March Quarter 2015.
Antonia Mercorella, CEO of the REIQ, says this result reflects a quieter
quarter in prestige property rather than a general fall in the overall market.
Mercorella says that the seasonally strong December Quarter 2014, which
saw the median reach $600,000, has also played a part in the results.
“March is historically the quietest quarter of the year, and after such
robust trading in December 2014 this dip was not unexpected.”
The report says data for the year ending March 2015 should boost
confidence, with house prices up 7.2 per cent compared to last year.
“Looking at the 12-month trend to March 2015, the median house price is
at $587,000 and this is an even more accurate reflection of what sales prices
are doing.”
The soft quarterly result was also countered by rising sales activity,
particularly for attached housing in outer suburbs with
new infrastructure.
“The Moreton Bay suburbs of Griffin, Petrie and Kallangur are benefiting
from the new rail line which will improve transport options for those
residents,
“The relative affordability of units and townhouses in the Redcliffe
region, with a median price of around $305,000, is a good entry point for
investors and owner occupiers who can’t afford to buy closer in,” Mercorella
says.
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RBA announcement: cash rate to stay at 2%
RBA announcement: cash rate to stay at 2%
Posted on Tuesday, June 02 2015 at 2:45 PM
The Reserve Bank of Australia’s governor Glenn Stevens announced today that the cash rate will remain at two per cent for at least another month.
In his
statement, he said: “In Australia, the available information suggests the
economy has continued to grow, but at a rate somewhat below its longer-term
average,” adding that “low interest rates are acting to support borrowing and
spending”.
“Having
eased monetary policy last month,” Stevens said, “the board today judged that
leaving the cash rate unchanged was appropriate at this meeting. Information on
economic and financial conditions to be received over the period ahead will
inform the Board’s assessment of the outlook and hence whether the current
stance of policy will most effectively foster sustainable growth and inflation
consistent with the target.”
The recent finder.com.au
Reserve Bank survey found that all 34 respondents were agreed that the cash
rate would stay on hold for June. Most of the experts felt that the RBA would
be conducting a “wait and see” approach, after last month’s cut.
BIS
Shrapnel’s Richard Robinson said: “They’ll
wait for a time when the rate cut will help engineer a fall in the dollar.
Residential markets are still too buoyant.”
Last
month’s decision to deliver a 25 basis point cut did help create a late autumn
property rush in Queensland, according to Raine Horne Beenleigh
co-principal Dennis Wey.
“Up
until early May the market in Logan City had been stuttering and the February
rate cut hadn’t been much help,” he says.
“But
when the RBA slashed rates to a record low of two per cent, the autumn property
market took off.
“The
enquiry level jumped immediately and was ferocious, with investors from Sydney
leading the charge.
“The
Sydney investors have recognised that there is plenty of value in our region
and we expect the May rate hike will provide the fuel that gets the Beenleigh
market motoring.”
In
the Moreton Bay region, the May rate cut helped drive up demand in suburbs such
as Burpengary, Narangba, Morayfield and Caboolture, according to local agent
Gina Wells.
“We
had a record month in April, doubling our sales averages,” she says.
Apart
from lower interest rates, Wells confirms there has been a significant surge in
Sydney investors, which is driving the Moreton Bay market.
“This
autumn market has been better than a traditional spring market, and we’re
getting back to boom levels with prices starting to rise,” she adds.
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