Key takeaways
Our property markets are continuing to rise, but more slowly than earlier in the year.
CoreLogic estimates the combined value of residential real estate rose to $10.9 trillion at the end of July. I remember when it hit $9 trillion before the pandemic and everyone was excited.
Auction markets moved through a 4th consecutive week where more than 2,000 homes went under the hammer, with a preliminary auction clearance rate of 71.7%, up from 70.2% the week prior (revised down to 64.4% on finalised numbers).
The preliminary clearance rate has held up amid the rise in auction volume and despite a broader rise in advertised stock levels and evidence of some momentum leaving the growth trend.
This week, CoreLogic Research reports that:
Sydney property prices remained flat over the last week, increased 0.2% over the last month and are 4.7% higher than they were 12 months ago.
Melbourne property prices fell -0.1% over the last week, fell -0.2% over the last month, and are -1.2% lower compared to 12 months ago.
Brisbane property prices increased by 0.2% over the last week, increased 0.9% over the last month and are 15.0% higher than they were 12 months ago.
Overall, Australian capital dwelling prices increased by 0.5% over the last month and are now 7.2% higher than they were 12 months ago.
And it's likely property prices and rents are going to keep increasing throughout 2024.
This current property cycle has been driven by an undersupply of good properties relative to current demand pushing up property values and rents there was nothing to suggest there will be any significant change in the near future.
Unfortunately, the undersupply properties is going to persist for some time with all commentators that there is no way we're going to hit the housing targets required to meet our demand.
Remember when the headlines were filled with predictions of an imminent recession in Australia?
Economists and commentators were almost unanimous in their gloomy forecasts: with interest rates rising sharply, the economy was expected to stall, and unemployment was projected to climb.
Many of these predictions made sense at the time —higher interest rates typically slow consumer spending, and in turn, cool down the economy.
But as we look around today, that dreaded recession has not materialized.
And what about the forecast of a fixed interest rate mortgage cliff? That didn't materialise dig it.
Our housing markets have remained remarkably resilient.
And based on the latest home lending figures, it's likely that our markets will enjoy a busy spring time.
With the value of new home lending rising 3.9% in July to $30.6 billion, it suggests Australians are buying $1billion worth of property every day.
- The value of new investor loans rose 5.4 per cent to $11.7 billion, which was 35.4 per cent higher than July 2023.
- The value of owner-occupier loans rose 2.9 per cent to $18.9 billion, 21.4 per cent higher than July 2023.
- The value of new owner-occupier first home buyer loans rose 0.8 per cent in July, which was 19.7 per cent higher than July 2023.
This week, CoreLogic reports that:
- Sydney property prices remained flat over the last week, increased 0.2% over the last month and are 4.7% higher than they were 12 months ago.
- Melbourne property prices fell -0.1% over the last week, fell -0.2% over the last month, and are -1.2% lower compared to 12 months ago.
- Brisbane property prices increased by 0.2% over the last week, increased 0.9% over the last month and are 15.0% higher than they were 12 months ago.
Overall, Australian capital dwelling prices increased by 0.5% over the last month and are now 7.2% higher than they were 12 months ago.
Clearly, the property cycle is moving on but our markets are very fragmented.
Source: CoreLogic September 9th 2024
Of course, these are "overall" figures - there is not one Sydney or Melbourne or Brisbane property market.
And various segments of each market are performing differently.
At the beginning of this cycle the upper quartile of the market lead the upswing but now the lower quartile across every capital city has recorded a stronger outcome for housing values relative to its upper quartile counterpart over the past quarter.
The following chart shows how various segments of each capital city market are performing differently with median-priced properties performing well.
To help keep you up-to-date with all that's happening in property, here is my updated weekly analysis of data and charts as of 9th September 2024 provided by CoreLogic, and realestate.com.au.
Preliminary clearance rate nudges higher week-on-week
Remember... Auction clearance rates are a great "in time" indicator of both buyer and seller sentiment.
The preliminary clearance rate has held up amid the rise in auction volume and despite a broader rise in advertised stock levels and evidence of some momentum leaving the growth trend.
2,065 homes went to auction last week, down from 2,315 the week prior and lower than a year ago when 2,275 homes were auctioned.
See Corelogic's full auction report below.
Current property asking prices
Property asking prices are a useful leading indicator for housing markets - giving a good indication of what's ahead.
Here is the latest data available:
Sydney
Property type | Price ($) | Weekly Change | Monthly Change % | Annual % change |
---|---|---|---|---|
All Houses | 1,917,235 | -1.235 | 0.0% | 3.9% |
All Units | 817,609 | -4.209 | -0.3% | 9.1% |
Combined | 1,472,811 | -2.437 | 0.0% | 4.7% |
Source: SQM Research
Melbourne
Property type | Price ($) | Weekly Change | Monthly Change % | Annual % change |
---|---|---|---|---|
All Houses | 1,238,039 | 1.961 | 0.1% | 4.9% |
All Units | 609,971 | 0.419 | -0.3% | 3.8% |
Combined | 1,041,193 | 1.478 | 0.0% | 4.5% |
Source: SQM Research
Brisbane
Property type | Price ($) | Weekly Change | Monthly Change % | Annual % change |
---|---|---|---|---|
All Houses | 1,159,379 | 2.962 | 2.3% | 17.9% |
All Units | 643,702 | -0.202 | 0.8% | 20.4% |
Combined | 1,030,703 | 2.173 | 2.1% | 18.2% |
Source: SQM Research
Perth
Property type | Price ($) | Weekly Change | Monthly Change % | Annual % change |
---|---|---|---|---|
All Houses | 1,063,218 | 7.371 | 2.8% | 25.1% |
All Units | 556,073 | 0.839 | 0.5% | 22.3% |
Combined | 931,048 | 5.669 | 2.5% | 24.5% |
Source: SQM Research
Adelaide
Property type | Price ($) | Weekly Change | Monthly Change % | Annual % change |
---|---|---|---|---|
All Houses | 946,041 | 9.961 | 2.1% | 21.4% |
All Units | 467,732 | 4.168 | 1.4% | 10.1% |
Combined | 860,199 | 8.921 | 2.0% | 20.1% |
Source: SQM Research
Canberra
Property type | Price ($) | Weekly Change | Monthly Change % | Annual % change |
---|---|---|---|---|
All Houses | 1,175,647 | -7.035 | -2.6% | 7.5% |
All Units | 590,422 | 4.328 | 0.5% | -1.4% |
Combined | 961,834 | -2.884 | -1.9% | 5.0% |
Source: SQM Research
Darwin
Property type | Price ($) | Weekly Change | Monthly Change % | Annual % change |
---|---|---|---|---|
All Houses | 653,674 | 5.926 | -0.4% | -3.6% |
All Units | 382,089 | -0.423 | 0.6% | 1.6% |
Combined | 547,056 | 3.434 | -0.1% | -2.3% |
Source: SQM Research
Hobart
Property type | Price ($) | Weekly Change | Monthly Change % | Annual % change |
---|---|---|---|---|
All Houses | 790,593 | 3.497 | 0.8% | -1.9% |
All Units | 492,492 | 6.417 | -2.8% | -0.4% |
Combined | 745,591 | 3.938 | 0.4% | -1.8% |
Source: SQM Research
National
Property type | Price ($) | Weekly Change | Monthly Change % | Annual % change |
---|---|---|---|---|
All Houses | 935,263 | 1.344 | 0.3% | 8.0% |
All Units | 556,394 | -1.606 | 0.4% | 8.3% |
Combined | 853,993 | 0.711 | 0.3% | 7.9% |
Source: SQM Research
Cap City Average
Property type | Price ($) | Weekly Change | Monthly Change % | Annual % change |
---|---|---|---|---|
All Houses | 1,390,085 | 1.057 | 0.7% | 7.7% |
All Units | 690,777 | -2.514 | -0.2% | 9.1% |
Combined | 1,183,796 | 0.004 | 0.6% | 7.7% |
Source: SQM Research
The value of property asking prices as a leading indicator for housing markets is quite significant.
In fact it's more valuable than median prices which can be quite misleading.
Let's delve into why this is the case and how it impacts the real estate market.
- Early Market Sentiment Indicator: Asking prices often reflect the current sentiment of sellers in the real estate market.
If sellers are confident, they might set higher asking prices, anticipating strong demand.
Conversely, if sellers are uncertain or perceive a market downturn, they might lower their asking prices to attract buyers.
This makes asking prices a real-time indicator of market sentiment, often preceding changes in actual sales prices. - Predictive of Future Price Trends: Trends in asking prices can be predictive of where the actual property prices are headed.
For example, a consistent rise in asking prices over a period can signal an upcoming rise in transaction prices. - Impact of Economic Factors: Economic factors such as interest rates, employment rates, and broader economic health influence asking prices.
For instance, changes in the Reserve Bank of Australia's policies or shifts in the job market can quickly reflect in the asking prices, providing insights into how these factors are influencing the housing market. - Regional Variations: In a diverse market like Australia's, asking prices can also provide insights into regional disparities.
For instance, the property markets in Melbourne and Sydney might behave differently from those in Brisbane or Perth. Asking prices can give early indications of these regional trends. - Influence of Supply and Demand: Asking prices are also a response to the balance of supply and demand in the market.
In areas with limited supply and high demand, asking prices tend to be higher and vice versa.
However, it's important to note that while asking prices are a valuable indicator, they should not be used in isolation.
Other factors like actual sales prices, time on the market, auction clearance rates, and economic conditions also play crucial roles in understanding the property market dynamics.
READ MORE: The latest median property prices in Australia’s major cities
Last weekend's auction report
Preliminary clearance rate holds up amid rising auction volumes
Auction markets moved through a 4th consecutive week where more than 2,000 homes went under the hammer, with a preliminary auction clearance rate of 71.7%, up from 70.2% the week prior (revised down to 64.4% on finalised numbers).
The preliminary clearance rate has held up amid the rise in auction volume and despite a broader rise in advertised stock levels and evidence of some momentum leaving the growth trend.
2,065 homes went to auction last week, down from 2,315 the week prior and lower than a year ago when 2,275 homes were auctioned.
Melbourne saw the most auctions last week, with 932 homes going to auction, down from 1,052 the week prior.
The preliminary clearance rate, at 71.1%, ticked a little higher relative to the previous week (70.0% which was revised down to 62.9% once finalised).
Sydney hosted 774 auctions last week, down from 874 the week prior, with a preliminary clearance rate of 73.2%, up from 71.3% over the previous week (which was revised down to 65.3% on final numbers).
The volume of auctions across the smaller markets was led by Brisbane, with 152 auctions and a preliminary clearance rate of 62.1%.
Adelaide held 146 auctions, with 80% successful on the early numbers, and 45 auctions were held across the ACT with a 65.5% clearance rate.
The volume of auctions is set to rise this week with around 2,480 homes currently scheduled for auction, increasing to approximately 2,780 the following week as the spring selling season gathers pace.
Our rental markets
The national CoreLogic hedonic rent index was unchanged for a second consecutive month in August, and rent values declined in Sydney for a second consecutive month.
Nationally, rent values were up 7.2% in the year to August, which is the lowest annual growth rate since May 2021.
Annual rent growth is now slowing in every capital city market, except for Hobart, which is coming off a dip in rent values through 2023.
Sydney
Property Type | Rent ($) | Weekly change | Monthly change | 12 Months change |
---|---|---|---|---|
All Houses | $1,031.18 | 1.82 | 0.0% | 6.0% |
All Units | $692.17 | -0.17 | -0.4% | 4.0% |
Combined | $829.79 | 0.57 | -0.2% | 5.0% |
Source: SQM Research
Melbourne
Property Type | Rent ($) | Weekly change | Monthly change | 12 Months change |
---|---|---|---|---|
All Houses | $747.17 | 1.83 | 1.3% | 7.3% |
All Units | $558.69 | -0.69 | 0.3% | 6.3% |
Combined | $636.57 | 0.38 | 0.8% | 6.8% |
Source: SQM Research
Brisbane
Property Type | Rent ($) | Weekly change | Monthly change | 12 Months change |
---|---|---|---|---|
All Houses | $722.11 | -1.11 | -1.6% | 4.9% |
All Units | $572.71 | 0.29 | 0.1% | 4.9% |
Combined | $654.86 | -0.48 | -0.9% | 4.9% |
Source: SQM Research
Perth
Property Type | Rent ($) | Weekly change | Monthly change | 12 Months change |
---|---|---|---|---|
All Houses | $780.01 | -0.01 | -0.3% | 8.7% |
All Units | $612.96 | 0.04 | -1.4% | 11.9% |
Combined | $710.43 | 0.05 | -0.7% | 9.9% |
Source: SQM Research
Adelaide
Property Type | Rent $) | Weekly change | Monthly change | 12 Months change |
---|---|---|---|---|
All Houses | $660.12 | -2.12 | 0.8% | 12.5% |
All Units | $510.65 | 11.35 | 3.1% | 16.3% |
Combined | $608.96 | 2.55 | 1.4% | 13.7% |
Source: SQM Research
Canberra
Property Type | Rent ($) | Weekly change | Monthly change | 12 Months change |
---|---|---|---|---|
All Houses | $775.40 | -0.40 | -0.3% | 2.8% |
All Units | $556.50 | -3.50 | -0.3% | -0.2% |
Combined | $656.37 | -2.20 | -0.3% | 1.3% |
Source: SQM Research
Darwin
Property Type | Rent ($) | Weekly change | Monthly change | 12 Months change |
---|---|---|---|---|
All Houses | $747.83 | -7.83 | 11.4% | -5.2% |
All Units | $495.51 | -8.51 | -6.7% | 6.9% |
Combined | $597.85 | -8.21 | 1.7% | 6.1% |
Source: SQM Research
Hobart
Property Type | Rent 9$) | Weekly change | Monthly change | 12 Months change |
---|---|---|---|---|
All Houses | $532.42 | -0.42 | -0.8% | 3.3% |
All Units | $456.70 | -3.70 | -1.6% | 1.1% |
Combined | $502.04 | -1.73 | -1.1% | 2.5% |
Source: SQM Research
National
Property Type | Rent ($) | Weekly change | Monthly change | 12 Months change |
---|---|---|---|---|
All Houses | $692.00 | -2.00 | -0.4% | 6.3% |
All Units | $547.00 | 1.00 | 0.6% | 7.3% |
Combined | $624.68 | -0.61 | 0.0% | 6.7% |
Source: SQM Research
Cap City Average
Property Type | Rent ($) | Weekly change | Monthly change | 12 Months change |
---|---|---|---|---|
All Houses | $831.00 | -1.00 | 0.4% | 6.8% |
All Units | $622.00 | 0.00 | 0.2% | 5.8% |
Combined | $719.74 | -0.48 | 0.3% | 6.3% |
Source: SQM Research
Sellers of good properties are on strike
Although winter traditionally is a seasonally slow period, national new listings have held above average since April.
Over the four weeks to 4 August, CoreLogic observed 36,973 new listings nationally, which is 1.0% higher than this time last year and 7.7% above the previous five-year average.
The problem is that very few are A Grade homes or investment grade properties. Owners of quality properties are still holding onto them.
At the national level, 136,135 listings were observed over the four weeks to 4 August, -1.7% below last year’s levels and -15.9% lower than the historic five-year average.
Despite the stronger flow of new listings, total national listing levels have held relatively steady, suggesting the market is absorbing the above-average flow of new listings.
Source: CoreLogic August 2024
Vendor metrics
As the following chart shows, houses are still being snapped up quickly by eager buyers.
At a national level, properties are taking slightly longer to sell than they were during the property boom of 2020 and 2021.
However, the number of days to sell a property is still relatively low (a sign of the tight supply situation for good properties), and vendor discounting is still at very low levels.
In general, houses are selling quicker than apartments, but the shortage of good properties on the market is seeing A-grade properties selling quickly with minimal discounting.