This week’s property market wrap from RPData- Tim Lawless

The Federal Budget was handed down earlier this week and from a property market perspective there was few highlights.

There were no changes to negative gearing however, the fifth round of the NRAS scheme has been scrapped and the scheme will no longer continue.

The termination of the NRAS scheme will probably have the biggest impact on the housing market given that some developers have heavily utilised the scheme as a selling point for their projects. First Home Buyer Saver Accounts were also scrapped however, the take-up had been poor so it is likely to have limited overall impact.

The temporary debt levy may impact on the higher end housing market however, it may also see higher income earners looking to reduce their taxable income, negatively geared investment properties may actually become more attractive.

Overall, the budget had very little in it for the property sector and is not likely to have a significant impact on the housing market, except of course for Canberra where 16,000 public sector job reductions were announced.

These job reductions are likely to have an impact on the housing market in Canberra, particularly considering it is already the weakest performing capital city housing market in the country.

The Australian Bureau of Statistics (ABS) released housing finance data for March 2014 earlier this week and you can read a lot more about it at the RP Data Research Blog.

The headline figures showed that the number of finance commitments to owner occupiers fell by -0.9% over the month with refinance commitments -1.0% lower and non-refinance commitments -0.9% lower.

Despite the monthly fall, refinance commitments are 11.6% higher year-on-year and non-refinance commitments are 5.4% higher. [sam id=43 codes=’true’]

The value of finance commitments fell by -1.0% over the month with owner occupier refinance commitments falling -1.3%, owner occupier non-refinance commitments -1.2% lower and investment finance commitments -0.8% lower.

Despite the monthly fall, the value of commitments is higher across each segment year-on-year; owner occupier refinances (19.9%), owner occupier non-refinances (10.8%) and investment (27.9%).

The number of owner occupier first home buyer commitments rose by 12.2% over the month (off a very low base) while year-on-year the number of commitments is -0.8% lower.

First home buyers currently account for 12.6% of all owner occupier housing finance commitments up from 12.5% in February 2014 but down from 14.1% a year ago.

Weekly Clearance Rates

Auction activity fell last week with 1,535 auctions across the combined capital cities. The weighted average capital city auction clearance rate was recorded at 65.0% last week which was up from 63.2% the previous week.

Melbourne is the country’s largest auction market and the clearance rate was recorded at 61.9% which was exactly the same as the previous week. Melbourne auction volumes were lower last week (710) than over the previous week (891).

Across Sydney, 618 auctions were held and the clearance rate was recorded at 73.3% compared to 821 auctions and a 71.4% clearance rate over the previous week. Auction volumes are set to be lower over the current week, with 1,994 capital city auctions currently scheduled.

Weekly auction clearance rates

Weekly Advertised Listings

Over the four weeks to 11 May, there were 43,166 newly advertised properties listed for sale nationally. The number of newly advertised property listings fell by -0.3% over the week and they are currently 10.9% higher than at the same time last year.

Across the combined capital cities, new listings were 0.9% higher over the week and 11.7% higher than a year ago.

There are currently 244,491 properties listed for sale across the country. Total listings at a national level were 0.4% higher over the week and are -2.0% lower than they were at the same time last year.

Across the combined capital cities, total listings have increased by 0.3% over the week however, they are -7.2% lower than they were at this time a year ago. Capital city listings account for just 42% of all listings nationally.

Advertised listings[post_ender]



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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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