Australia Property Market News

Liam

The strong rebound in Australian property values has come to a stop with the Coronavirus lockdown

Auction clearance rates and buyer sentiment have collapsed, unemployment is surging, and mortgage availability is tightening. All of which points to declines in Australian dwelling values. Yet these headwinds pale next to the looming headwind of heavy falls in mass immigration over the medium term… Listen in as MB Fund’s Head of Investments Damien Klassen, Chief Economist Leith van Onselen, Chief Strategist David Llewellyn Smith and Head of Operations Tim Fuller discuss the ultimate victim of Coronavirus, Australian property prices Visit the give below link to view the video: x MB Fund Podcast: Coronavirus to kill Australian pr... Unemployment, auction clearance rates & tightening mortgage availability all point to the ultimate victim of Coronavirus being Australian property prices www.macrobusiness.com.au

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InvestAus

Australian housing values have tumbled by 1.3 per cent in the past two months

A 0.7 per cent decline in June followed a 0.4 per cent decrease in May, which was the first fall recorded since mid-2019. When looking at the combined capital cities alone, real estate prices dropped by 0.8 per cent in June. The only capital cities which did not see housing values decline were Hobart, Darwin and Canberra. Melbourne led the price drops, with median real estate values tumbling by 1.1 per cent to $683,529 in June. In Sydney, the median property value decreased by 0.8 per cent to $875,749. Nationally, price changes were still positive in the past 12 months, jumping by 7.8 per cent, as all capital cities bar Perth and Darwin still saw capital growth. Annual price growth was led by Sydney and Melbourne, where housing values surged by 13.3 per cent and 10.2 per cent respectively. “A variety of factors have helped to protect home values from more significant declines, including persistently low advertised stock levels and significant government stimulus,” he said. “Additionally, low interest rates and forbearance policies from lenders have helped to keep urgent sales off the market, providing further insulation to housing values.” Source: x Australian home prices fall two months in a row Australian housing values have tumbled by 1.3 per cent in the past two months, according to the latest CoreLogic data, as prices drop for a second consecutive month. www.ratecity.com.au

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InvestAus

The top 10 markets seeing the biggest property price falls

Price

“So far, property value declines have been fairly mild. Nationally, the May home value index results show that the dwelling market declined just 0.4 per cent over the month, and preliminary indicators for June are showing the rate of decline has gathered some momentum through the month. “However, the Australian housing market is not one market, but a collection of many. Over the past few months, dwelling market performance has varied by region, in both a cyclical and structural way,” Ms Owen explained. The top 10 markets seeing the biggest property price falls are: Mandurah (WA): -2.2 per cent Greater Melbourne Melbourne - Inner South: -2.2 per cent Greater Melbourne Melbourne - Inner: -1.8 per cent Greater Melbourne Melbourne - Inner East:-1.8 per cent Greater Perth Perth - South East: -1.2 per cent Greater Melbourne Melbourne - Outer East: -1.2 per cent Greater Brisbane Ipswich: -0.8 per cent Greater Sydney Sydney - North Sydney and Hornsby: -0.7 per cent Greater Sydney Sydney - Inner West: -0.7 per cent Greater Sydney Sydney - Northern Beaches: -0.7 per cent “Unsurprisingly, Melbourne’s inner city and eastern suburbs have seen the largest decline across the metropolitan region, and the past two months have seen a decline in values across some high end markets in Sydney, such as North Sydney, the Inner West and the Northern Beaches,” Ms Owen said. “International border closures in response to COVID-19 may have created a significant demand shock, which had interrupted a recovery in the Perth - South East region. Prior to this, dwelling values in the area had seen four consecutive months of growth between December 2019 and March 2020.” Ms Owen noted at a suburb level, the biggest price falls are more reflective of the historic cyclical trends, “where the downturn is most prevalent in the high end of Sydney and Melbourne this far”. Source: x 10 areas where property prices are falling New research has identified the top 10 areas recording the greatest change in dwelling market values from 31 March to 31 May. www.smartpropertyinvestment.com.au

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InvestAus

Vacancy rates have come to a standstill in some areas, remaining at 2.2 per cent nationwide

Research by Domain economist Trent Wiltsire said that while each capital city rental market has been affected differently by the COVID-19 crisis, the national vacancy rate held steady in June, stabilising after an 80 basis point rise in April. “Some states have decided to open up borders, and economic activity is returning to somewhat normality; however, Victoria faces a second wave of coronavirus transmissions,” Mr Wiltshire said. “Vacancy rates were broadly steady in Melbourne, Sydney and Brisbane, while Hobart, Perth and Darwin saw the biggest falls. “Sydney’s vacancy rate remained at 3.6 per cent but remains 50 basis points higher than one year ago and 90 basis points higher than March. There were an estimated 22,665 vacant rentals at the end of June, a rise of 133 from a month ago.” “Adelaide is now Australia’s second-tightest rental market, even though vacancy rates fell 10 basis points to 1 per cent, 10 basis points lower year-on-year,” Mr Wiltshire added. “Canberra’s vacancy rate fell by 20 basis points to 1.1 per cent in May – matching the fall year-on-year. “In Darwin, the vacancy rate fell 60 basis points to 2.2 per cent and is 130 basis points lower than a year ago.” Get details at: x Vacancy rates hold steady Vacancy rates have come to a standstill in some areas, remaining at 2.2 per cent nationwide. www.smartpropertyinvestment.com.au

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MD Emren

New mortgage-holders can now get rates for below 2 per cent

According to comparison site Canstar, the official home loan rate offered by Tasmanian-owned Bank of Us is introducing one-, two- and three-year fixed home loan rates at 1.99 per cent. Canstar’s finance expert, Steve Mickenbecker, believes the savings on offer for home owners are the biggest that have been seen yet. “Bank of Us has come from nowhere in the rate race to now be the market leader at 1.99 per cent, having cut rates by 0.60 per cent for one- and two-year fixed rates and 1.14 per cent for three-year fixed,” Mr Mickenbecker said. “The difference a rate below 2 per cent can make is huge,” Mr Mickenbecker said. While highlighting the offer is only for fixed interest rates, the finance expert questioned how long it would take for variable rates to follow. Source: x Where can you get a mortgage rate under 2 per cent... New mortgage-holders can now get rates for below 2 per cent, as authorised deposit-taking institutions fight for new business. www.smartpropertyinvestment.com.au

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John

Increasing number of homes being put into auction

If there's one proof that seller confidence is improving across Australia, it would be the increasing number of homes being put into auction, according to the latest figures from CoreLogic. Capital city auction markets hosted 1,424 auctions during the weekend, the highest level of activity recorded in nine weeks. This was an increase from the 1,251 homes reported over the preceding weekend. Of all the homes that went under the hammer, 64.5% were successfully sold based on preliminary figures. Sydney also reported rosy auction figures, with 614 homes that returned a clearance rate of 66.9% However, the most successful city for auctions was Adelaide. Of the 46 homes that were auctioned over the weekend, 76% pushed through a sale. The table below shows the performance of each capital city:

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John

Australian homebuyers and investors increasingly looking at regional markets,

The impacts of the COVID-19 outbreak on the housing market appear to have sparked a shift in the preference of Australian homebuyers and investors, who are now increasingly looking at regional markets, according to market experts. Cate Bakos, president of the Real Estate Buyers Agents Association (REBAA), said properties in many regional locations are recording an increase in demand and shorter days-on-market amid the COVID-19 pandemic."Be mindful that if you do have to commute to a major city for work, whether it be one day per week or five days per week, that you can tolerate the commute journey and all that goes with the extended travel time," "The official data also shows that most of Australia's best-performed property markets over the last five years were spread throughout regional Australia, not in the capital cities," he said. Matt Ward, a local agent from Aspect Buyers Agency in New South Wales, said buyers are interested in "rural lifestyle blocks" closer to larger regional centres. "We're seeing a lot of new entrants into the market as more people realise that the need for space, a side income and somewhere to escape to on the weekend can all be met in the one property," he said. Get details at: x Regional markets gaining traction? Investors see the potential for stronger rental yields in regional housing markets, an expert says www.yourinvestmentpropertymag.com.au

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Justprop Team member

Australia's housing market clocked its second month of price declines

Price

National house prices declined by 0.7% in June, with Perth and Melbourne reporting the most significant decrease at 1.1%. Of all capital cities, only Hobart, Darwin, and Canberra reported gains in dwelling values of the month. This downward pressure on home values is considered mild, with capital cities recording a cumulative decline of 1.3% over the past two months, said Tim Lawless, head of research at CoreLogic. "These factors have helped to keep urgent sales off the market, providing further insulation to housing values," he said. In fact, despite the decline in values, the market remained busy over the month with a 29.5% estimated sales growth, extending the 21.5% surge in May. On an annual basis, prices maintained their solid position, with Sydney and Melbourne recording double-digit upswings of 13.3% and 10.2%, respectively. Source: x Small decline in house prices What could be insulating the housing market from a more substantial decline in dwelling values? www.yourinvestmentpropertymag.com.au

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InvestAus

Falls in national house prices accelerated over the month of June

Following 11 months of gains, dwellings have been reduced by more than a per cent following 0.4 per cent in May before falling a further 0.7 per cent in June. Melbourne and Perth had the biggest reduction in house prices, falling by 1.1 per cent in June, followed by a 0.8 per cent decrease in Sydney, a 0.4 per cent fall in Brisbane and a drop of 0.2 per cent in Adelaide, according to CoreLogic’s hedonic home value index. “The past three months has seen this trend playing out, with upper quartile values down 1.7 per cent across the combined capital city index over the past three months, while lower quartile values have fallen by only 0.3 per cent,” Mr Lawless said. This capital city trend is driven mostly by Sydney and Melbourne, while the smaller cities have shown a mixed result across the valuation cohorts. In Sydney, the upper quartile is down 1.3 per cent over the past three months, while lower quartile values are up 0.2 per cent. Similarly, over the same period in Melbourne, upper quartile values are down 3.7 per cent, while lower quartile values have declined a more modest 0.5 per cent. Get details at: x Property market dips for second straight month Falls in national house prices accelerated over the month of June, with the September cliff still looming, new research has shown. www.smartpropertyinvestment.com.au

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InvestAus

NSW: Home prices in Sydney have been falling faster as the economic fallout from coronavirus deepens

Sydney

Property values fell in June by double the rate they did over May, with the median home price down 0.8 per cent, CoreLogic’s hedonic home value index revealed. The median price of a freestanding house was $1.01 million, 0.9 per cent lower than at the start of June, while the median unit price was $761,000, 0.6 per cent lower. The stimulus, along with record low interest rates and bank support for struggling mortgagees, prevented mass distressed sales that would otherwise have sent prices plummeting, Mr Lawless said. “It’s encouraging to see lenders have recently hinted at an extension in their repayment leniency policies (but) government stimulus will eventually taper and banks will require borrowers to repay their loans,” he said. The 0.4 per cent average fall in values over May was the first time Sydney home prices had dropped in close to a year. Home values inched up 0.4 per cent during the height of lockdown measures in April and there was also an increase in values over March. Source: x Home prices fall at double previous rate in Sydney... Home prices were largely unaffected by the weaker economy when the COVID-19 pandemic first hit but this has begun to change, with prices falling by the biggest margin in more than a year. www.realestate.com.au

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Liam

The strong rebound in Australian property values has come to a stop with the Coronavirus lockdown

InvestAus

Australian housing values have tumbled by 1.3 per cent in the past two months

InvestAus

The top 10 markets seeing the biggest property price falls

InvestAus

Vacancy rates have come to a standstill in some areas, remaining at 2.2 per cent nationwide

MD Emren

New mortgage-holders can now get rates for below 2 per cent

John

Increasing number of homes being put into auction

John

Australian homebuyers and investors increasingly looking at regional markets,

Justprop Team member

Australia's housing market clocked its second month of price declines

InvestAus

Falls in national house prices accelerated over the month of June

InvestAus

NSW: Home prices in Sydney have been falling faster as the economic fallout from coronavirus deepens

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