Last week we saw the Australian Bureau of Statistics (ABS) release labour force data for the month of July which showed a slight rise in the national rate of unemployment, up from a revised 6.1% in June to be 6.3% in July.
The lift in the unemployment rate can be partly attributed to the participation rate reaching a 2½ year high at 65.1%.
38,500 new jobs were created over the month, taking the annual rate of jobs growth to 243,600 or 2.1% higher than a year ago.
What it means
While the jobs growth figures look healthy, the vast majority of new jobs were located in New South Wales (29,500).
The ABS also released the latest wages index which revealed a 0.6% rise in total hourly wages (excluding bonuses) taking the annual pace of wages growth to 2.3% which is the lowest pace of wages growth on record (the ABS wage price index starts in Sep 1997).
The fact that households are benefiting from lower interest rates, higher housing prices and higher share prices should help to alleviate financial pressures on household budgets.
Westpac and the Melbourne Institute released consumer sentiment figures this week which showed confidence levels bounced higher in August, up by 7.8% to reach an index reading of 99.5.
This is the sixteenth month over the past eighteen months where the index has remained below 100 (where optimists and pessimists are equally balanced)
The two months within this period where the confidence index rose above the 100 mark were both aligned with RBA rate cuts, demonstrating what seems to be a temporary boost to sentiment levels via lower
The ‘time to buy a dwelling’ sub index rose buy 8.2% over the month but remains nearly 16% lower compared with the August last year.
The ABS also released data on overseas arrivals and departures for June which showed net permanent and long term arrivals to Australia reached the lowest level in four years.
The ongoing slowdown in net overseas migrants is likely to foreshadow further reductions to Australia’s rate of population growth when more up to date demographic data is released by the ABS.
Over the past week, CoreLogic RP Data was tracking 2,512 auctions, a healthy increase from the previous week when there were 1,903 auctions held across the capital cities.
Across the combined capital cities, the weighted average clearance rate was 76.9% last week, up from 74.6% the previous week.
Across Melbourne, 1,084 homes were taken to auction with a clearance rate of 78.5%.
Last week was the busiest week for Melbourne auctions since May.
Despite this, for the second consecutive week, there were more auctions held in Sydney than Melbourne.
Auction volumes across the city were up from 825 the previous week to 1,103 last week, with a clearance rate of 78.3%.
In comparison, over the previous week, the city saw a lower clearance rate of 76.0%.
The number of newly advertised properties being added to the housing market has remained relatively steady over the past four months, with roughly 26,000 newly advertised homes being listed for sale across the capital cities each month.
New listing numbers generally start to ramp higher over the second half of August, so, if history is anything to go by, we are likely to see an escalation in listing activity over the coming weeks.
Compared with the same time last year, capital city listings are now 13.2% higher and national new listing numbers are 9.7% higher.
The most significant boost in new listing numbers is coming from the most buoyant housing markets, Sydney (+20.1%) and Melbourne (+19.2%) while the softer housing markets are seeing new listing numbers substantially lower than a year ago.
The opposite is true for the total number of properties being advertised for sale, with total listings in Sydney, Melbourne, Brisbane, Hobart and Canberra lower compared with a year ago indicating a higher rate of absorption than the weaker markets of Perth, Darwin and Adelaide where total listings are up on last year.
At a combined capital city level, total advertised stock levels are virtually level with the same time last year (-0.4%) while nationally total stock levels are 1.8% lower than a year ago.