With the financial year drawing to an end, it is worthwhile providing a quick re-cap on the performance of the housing market.
June also marks the two year anniversary of the current growth phase where capital city real estate values broadly started increasing in June 2012.
The past financial year has seen dwelling values rise by about 9.7% compared with a 3.8% capital gain over the 2012/13 financial year.
Sydney has been the primary driver of capital gains, with values up almost 15% over the financial year, followed by Melbourne where capital gains will end the year around 8% higher.
Brisbane values have gained about 6.8%, Darwin values are up about 6.6%, Perth 5.5%, Adelaide 3.0%, Hobart 2.3% and Canberra 2.2%.
While growth conditions have been very strong, compared to previous growth cycles the rate of capital gain has been quite tame: in 2001/02 values moved 20.7% higher and the year after values were 15.8% higher.
Over the previous growth cycle, the 2009/10 financial year saw capital city dwelling values rise by 12.3%.[sam id=37 codes=’true’]
RP Data will release the final end of financial year capital gain figures on Tuesday next week where we are expecting the market to show a partial recovery from the 1.9% drop in values over the month of May.
In other news, the Roy Morgan consumer confidence survey was released this week showing confidence levels rose 2.4% over the week and the reading is now 6.4% higher since the recent post budget low recorded by the index on May 25.
The gradual improvement in confidence levels is an encouraging sign that the original ‘sticker shock’ from the federal budget is starting to dissipate.
The Bureau of Resources and Energy Economics (the Federal Government department which forecast the performance of commodity prices and exports each quarter) has indicated further reductions in key commodity prices but they are also forecasting rising export volumes across the resources and energy sector as the production phase gathers pace on the back of previously significant infrastructure investment.
Weekly Clearance Rates
Auction clearance rates held steady over the week with the capital city weighted average clearance rate recorded at 65.4%, virtually the same as the final clearance rate from the week before (65.5%).
There were 2,040 auctions held over the week compared with 1,655 over the same week a year prior. RP Data collected 87% of all auction records. The major auction markets of Sydney and Melbourne continued to record healthy auction results.
Sydney’s clearance rate was 70.1% across 663 reported auctions, slightly higher than the previous two weeks results. Melbourne’s auction market recorded a clearance rate of 69.1% across 846 collected auction results.
The clearance rate in Melbourne over the past two weeks has moved higher compared with the previous two months where clearance rates were averaging in the low 60’s.
Weekly Advertised Listings
Over the four weeks to 22 June, there were 37,444 newly advertised properties listed for sale nationally. New listing numbers have continued to trend lower, which likely to be mostly a seasonal phenomenon.
Nationally, new listings have moved to be 2.9% lower than a year ago, while across the combined capital cities new stock being added to the market is virtually on par with the same time last year (0.8% higher).
There are currently 244,540 properties listed for sale across the country. Total listings at a national level were 1.0% lower compared with the same time last year.
Across the combined capital cities, total listings remain 5.3% lower than a year ago, highlighting that total stock levels have reduced.