This week’s property market wrap | RPData

Here’s the latest property news for the week ending october 17th…

Late last week the Australian Bureau of Statistics released the latest housing finance data for the month of August which provides the timeliest update on mortgage demand across Australian housing markets.block building

The headline figures showed the number of owner occupier mortgages was down 0.9% over the month, but excluding refinanced loans, new mortgage commitments were down 1.9% over the month.

Despite the month on month dip, the number of owner occupier mortgages remains 4.4% higher compared with a year ago (+1.9% excluding refinances).

There are some regional differences with commitments in NSW down 0.6% over the year and down by 1.5% in WA over the year. New loan commitments in Vic are up 3.5% and in Qld they are 8.2% higher.

Looking at the investor side of mortgage demand, the August numbers showed a welcome softening across this cohort of the market as well, with the value of investor loans virtually flat in August (-0.1%) after a 5.6% surge in July.

Over the past year the value of investor mortgages has increased by 27.6%, demonstrating the surge in investment in the housing market over the current cycle.

The RBA and APRA will probably see some comfort that investor related mortgages didn’t rise further in August, however the year on year rise provides some rationale for the recent announcement that the APRA, supported by the RBA, are likely to announce macroprudential measures to slow investor related demand later this year.

Both business and consumer confidence indices were released this week by NAB and Westpac respectively.graphs

The NAB business confidence index showed a slowdown in September to be level with the long run average of +5 on the index.

This is the softest business confidence reading since the pre-election month of August last year.

From a consumer perspective, the Westpac-Melbourne Institute Consumer Sentiment Index was relatively flat over the month, rising by 0.9% to reach 94.8 points on the index.

This is the eighth consecutive month where the index has been below the 100 mark where optimists and pessimists are equally weighted. There is a strong correlation between consumer sentiment and housing market conditions; with sentiment remaining low there is likely to be some downwards pressure on dwelling transaction volumes.

Additionally, the Australian Bureau of Statistics released building activity for the June quarter.

Dwelling starts were down 6.9% over the quarter but were 9.2% higher over the year.ultimate_adelaide_tour_big_0

The weak quarterly result was due to a larger drop in the more volatile apartments sector where new dwelling commencements were down 15.1% over the quarter while house starts were 1.6% higher over the quarter.

Over the past 12 months there were almost 180,500 new dwelling starts which is the highest annual reading in over 19 years.

The lift in dwelling construction is a very positive sign of the national economy; the construction is broad based rather than being concentrated in one or two cites, and the uplift across the sector provides a substantial multiplier to economic growth, creating employment and pushing demand for building materials, home furnishings and appliances higher.

Weekly Clearance Rates

Auction markets remained strong over the past week with the weighted average clearance rate recorded at 67.8%, which is slightly higher than over the previous week when 66.9% of capital city auctions were successful.

2,408 auctions were held across the capital cities, of which RP Data collected results for 2,043 or 85% of all auctions held.

The largest auction markets of Sydney and Melbourne continued to record high clearance rates. Sydney’s auction market recorded a clearance of 71.9% across 918 auctions.

This is was the 17th consecutive week where clearance rates have been at least 70%. In Melbourne there were 1,123 auctions held with a clearance rate of 70.0%.

The remaining capital cities accounted for just 15% of the total auction count. Adelaide recorded a clearance rate of 55.8% across 115 auctions, Brisbane recorded a clearance rate of 48.8% from 167 auctions, Canberra’s clearance rate was 53.1% from 55 auctions and Perth saw a clearance of 52.6% across 25 auctions.

 

Capital city auction clearance rates  – week ending October 12, 2014

Weekly auction clearance rates

 

Weekly Advertised Listings

Over the four weeks to the 12th of October, there were 46,899 newly advertised properties listed for sale nationally.

New listing numbers are continuing to move higher as the Spring season gathers pace.

Despite the rise, the number of newly advertised properties listing for sale is down 1.4% compared with the same period last year. Across the combined capitals there were 29,394 newly advertised properties added to the markets which is actually slightly higher (+1.2%) than a year ago. The rise in new listings is being driven by Brisbane where there has been an 11.3% increase compared with the same time last year.

There are currently 240,762 properties listed for sale across the country which is 4.6% lower than a year ago.

In the capital cities, listing numbers are 8.5% lower than a year ago with 101,330 properties currently being advertised for sale. Every capital city is showing listing numbers to be lower than a year ago, except Darwin and Perth where effective supply levels are up 21.6% and 1.2% respectively.

Note that sales listings are based on a rolling monthly count of unique properties that have been advertised for sale.

 Number of homes for sale

Residential property listings advertised for sale over the four weeks ending 12/10/2014

Advertised listings



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Tim Lawless

About

Tim heads up the Core Logic RP Data research and analytics team, analysing real estate markets, demographics and economic trends across Australia. Visit www.corelogic.com.au


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