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By Michael Yardney
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This week’s Australian Property Market Update – Latest Data, State by State June 18th 2024

key takeaways

Key takeaways

Inflation is easing, but it’s doing so more slowly than previously expected and still remains high.

The Reserve Bank expect that inflation will remain higher than the target range for some and is therefore vigilant to upside risks but, on balance, it's likely rates will remain on hold for a long time.

The preliminary clearance rate across the combined capitals came in at 71.5% last weekend , 40 basis points higher than the previous week (71.1%)

The volume of capital city auctions was roughly in line with the prior week, with 2,163 auctions held (2,146 the week prior) but well up on the same week a year ago when 1,887 auctions were held.

This week, CoreLogic reports that:

Sydney property prices increased 0.1% over the last week, increased 0.5% over the last month and are 7.3% higher than they were 12 months ago.

Melbourne property prices increased 0.1% over the last week, also increased 0.1% over the last month, and are 2.0% higher than they were 12 months ago.

Brisbane property prices increased by 0.4% over the last week, increased 1.2% over the last month and are 15.9% higher than they were 12 months ago.

Overall, Australian capital dwelling prices increased by 0.7% over the last month and are now 9.0% higher than they were 12 months ago.

Our combined capital cities have increased in value by 10.2% over the last year. That's very different to the pessimistic forecasts of double digit price falls made by the RBA and many of the bank economists only 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 in last week's budget 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.

Inflation is easing, but it’s doing so more slowly than previously expected and still remains high.

The Reserve Bank expect that inflation will remain higher than the target range for some and is therefore vigilant to upside risks, stating:

“The path of interest rates that will best ensure that inflation returns to target in a reasonable timeframe remains uncertain, and the board is not ruling anything in or out. The board will rely upon the data and evolving assessment of risks.”

“We don’t think we necessarily have to tighten again. But we can’t rule it out. If we have to, we will. If we really think that inflation is going to be persistent and significantly above our forecast, we will tighten again.”

They also said:  “Inflation will need to be persistently and significantly above their forecast” for them to raise rates.

In other words, interest rates won’t rise if there are short-term upticks or blips. but will only increase again if significnat factors are persistent.

So what factors will the RBA take into account?

Dr Andrew Wilson has provided the following matrix of factors and concludes that, on balance, interest rates will remain steady for quite some time.

Current Rate Decision Variable 27 May

Clearance rates are looking resilient, despite higher volumes

Remember... Auction clearance rates are a great "in time" indicator of both buyer and seller sentiment.

The number of homes going under the hammer rebounded last week following the previous week’s drop in auction volume due to the King’s Birthday long weekend in many states. 2,232 auctions were held, up from 1,317 the week prior and nearly 15% higher than at the same time last year.

The preliminary combined capitals clearance rate also bounced higher to 72.9%, the strongest early result since the first week of May (73.5%).

The previous week's preliminary clearance rate, which came in at 67.3% and was revised down to 62.0% once finalised, was the lowest since late last year.

See Corelogic's full auction report below.

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 for June 2024.

Sydney

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,941,915 17.206 0.8% 8.0%
All Units 812,414 6.886 1.6% 5.7%
Combined 1,486,238 12.649 1.0% 7.1%

Source: SQM Research

Melbourne

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,262,080 1.010 0.5% 6.6%
All Units 606,128 2.672 -0.1% 2.4%
Combined 1,056,944 1.329 0.4% 5.6%

Source: SQM Research

Brisbane

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,105,214 0.573 0.9% 14.2%
All Units 619,944 1.856 2.1% 19.6%
Combined 984,286 0.811 1.0% 14.9%

Source: SQM Research

Perth

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,002,896 8.334 1.8% 19.5%
All Units 525,096 2.604 2.2% 19.2%
Combined 878,567 6.753 1.8% 19.3%

Source: SQM Research

Adelaide

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 918,612 9.137 1.4% 16.6%
All Units 465,283 -2.783 0.6% 10.7%
Combined 837,293 6.991 1.3% 15.9%

Source: SQM Research

Canberra

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,229,715 10.772 2.7% 17.4%
All Units 605,463 0.399 1.6% 2.5%
Combined 1,002,560 6.554 2.4% 13.5%

Source: SQM Research

Darwin

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 662,272 7.128 -0.2% -2.4%
All Units 372,874 0.126 1.1% -1.6%
Combined 548,695 4.349 0.2% -2.2%

Source: SQM Research

Hobart

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 788,828 2.444 0.4% 0.4%
All Units 515,444 -15.990 -2.0% -0.3%
Combined 747,639 -0.379 0.2% 0.2%

Source: SQM Research, May 2024

Source: SQM Research

National

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 934,061 1.929 1.6% 9.4%
All Units 547,477 -4.049 0.7% 7.1%
Combined 851,293 0.570 1.4% 9.0%

Source: SQM Research

Cap City Average

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,394,639 12.595 1.1% 9.6%
All Units 688,106 6.661 1.9% 6.9%
Combined 1,186,677 10.629 1.2% 8.9%

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.

  1. 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.
  2. 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.
  3. 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.
  4. 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.
  5. 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

Clearance rates are looking resilient, despite higher volumes

The number of homes going under the hammer rebounded last week following the previous week’s drop in auction volume due to the King’s Birthday long weekend in many states.

2,232 auctions were held, up from 1,317 the week prior and nearly 15% higher than at the same time last year.

The preliminary combined capitals clearance rate also bounced higher to 72.9%, the strongest early result since the first week of May (73.5%).

The previous week's preliminary clearance rate, which came in at 67.3% and was revised down to 62.0% once finalised, was the lowest since late last year.

Capital City Auction Statistics

With 1,054 homes going under the hammer across Melbourne, the number of auctions held more than doubled relative to the previous week (488) and the preliminary clearance rate rose to 70.2%, the highest early result since the last week of May.

The volume of auctions rose to 795 in Sydney, up from 523 the week prior and 764 held at the same time last year.

The preliminary clearance rate (75.0%) also showed some strength, rising to the highest level since the week ending May 12 (75.9%).

Brisbane led the volume across the smaller auction markets with 193 homes taken to auction, returning a preliminary clearance rate of 68.9%, followed by Adelaide with 118 auctions held and a preliminary clearance rate of 88.9%.

55 auctions were held across the ACT with an early success rate of 73.3%.

Despite the higher number of homes taken to market, clearance rates are looking resilient, suggesting demand is keeping up with the rise in vendor activity.

The trend in auction markets lines up with the broader trend in new listings, where vendor activity was 9.5% above the previous five-year average, while overall stock levels were tracking 16.1% below the five-year benchmark, demonstrating a healthy rate of absorption.

At the same time, dwelling values continue to trend higher, with CoreLogic’s daily HVI rising a further 0.8% over the past four weeks across the combined capitals.

City Clearance Rate Total Auctions CoreLogic auction results Cleared Auctions Uncleared Auctions
Sydney 72.7% 747 596 433 163
Melbourne 71.2% 1,025 756 538 218
Brisbane 69.5% 148 95 66 29
Adelaide 78.4% 149 74 58 16
Perth n/a 9 5 2 3
Tasmania n/a 3 3 2 1
Canberra 59.3% 82 54 32 22
Weighted Average 71.5% 2,163 1,583 1,131 452

Source: CoreLogic

Our rental markets

Nationally, rents were up 0.8% in April, a slightly lower rate of growth relative to February and March when the national rental index rose 0.9% and 1.0% respectively.

Across the individual capitals, dwelling rents rose over the past three months in most cities, with Darwin recording the only fall.

Despite an uptick in gross rental yields, investors with a high amount of leverage are likely to be facing a negative cash flow on their property.

Annual Change In Rents Houses

Annual Change In Rents Units

Gross Rental Yield Dwellings Combined Capitals Vs Combined Regionals

Sydney

Property Type Rent ($) Weekly change Monthly change  12 Months change
All Houses $1,046.59 -3.59 -1.4% 7.7%
All Units $700.46 -3.46 -0.4% 7.3%
Combined $849.41 -3.36 -0.2% 8.4%

Source: SQM Research

Melbourne

Property Type Rent ($) Weekly change Monthly change  12 Months change
All Houses $744.95 0.05 0.2% 10.5%
All Units $559.05 -0.05 0.2% 7.6%
Combined $635.74 -0.01 0.2% 9.0%

Source: SQM Research

Brisbane

Property Type Rent ($) Weekly change Monthly change 12 Months change
All Houses $716.41 -0.41 0.1% 6.5%
All Units $581.65 2.35 0.7% 10.5%
Combined $655.77 0.83 0.4% 8.1%

Source: SQM Research

Perth

Property Type Rent ($) Weekly change Monthly change 12 Months  change
All Houses $787.38 -2.38 -0.1% 16.8%
All Units $610.99 4.01 2.6% 16.9%
Combined $713.72 0.29 0.8% 16.9%

Source: SQM Research

Adelaide

Property Type Rent $) Weekly change Monthly change 12 Months change
All Houses $643.82 1.18 1.7% 11.3%
All Units $487.04 6.96 3.3% 16.1%
Combined $589.92 3.17 2.2% 12.8%

Source: SQM Research

Canberra

Property Type Rent ($) Weekly change Monthly change 12 Months change
All Houses $770.89 7.11 0.2% -1.4%
All Units $565.93 -0.93 -0.9% 1.1%
Combined $659.72 2.75 -0.3% -0.3%

Source: SQM Research

Darwin

Property Type Rent ($) Weekly change Monthly change 12 Months change
All Houses $700.57 10.43 0.9% -1.4%
All Units $520.26 -30.26 -0.2% 3.6%
Combined $593.23 -13.79 0.4% 1.2%

Source: SQM Research

Hobart

Property Type Rent 9$) Weekly change Monthly change 12 Months change
All Houses $530.15 -2.15 -1.7% -0.6%
All Units $459.02 -0.02 0.6% 2.4%
Combined $501.58 -1.30 -0.9% -1.3%

Source: SQM Research

National

Property Type Rent ($) Weekly change Monthly change 12 Months change
All Houses $694.00 -3.00 -0.1% 9.5%
All Units $540.00 -2.00 -0.4% 8.9%
Combined $622.46 -2.54 -0.2% 9.3%

Source: SQM Research

Cap City Average

Property Type Rent ($) Weekly change Monthly change 12 Months change
All Houses $835 -4.00 -0.5% 9.6%
All Units $628 -1.00 0.2% 8.3%
Combined $724.80 -2.40 -0.2% 9.0%

Source: SQM Research

Sellers of good properties are on strike

Earlier in the year, more sellers put their properties on the market, feeling confident than inflation was under control and interest rates were heading down, however now the expectation of an interest-rate cut has been pushed out to the end of the year or early next year

There is now an acute shortage of A-grade homes and investment-grade properties for sale.

Capital City Properties For Sale 27 May

Listings 12 Month Change 27 May

Source: Corelogic May 2024

The charts below show the lack of property listings available for serious buyers at present, and with home buyers back in the market well located properties are being snapped up quickly.

But not all properties are selling well- there is currently a flight to quality.

Property listings for sale provide a useful real-time indicator of seller sentiment and general market confidence.

However, this year sellers have erred on the side of caution before listing with the flow of new listings consistently below average since spring last year.

Number Of Homes For Sale Combined Capital Cities

Source: CoreLogic May 2024

Vendor metrics


As the following chart shows, houses are still being snapped up quickly by eager buyers.

Median Days On Market 3 Months To April 2024

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.

Median Vendor Discount 3 Months To April 2024

 

ALSO READ: Latest property price forecasts revealed. What’s ahead in our housing markets in the next year or two?

About Michael Yardney Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media.
78 comments

I own 4 properties around Brisbane. Is it a good time to sell properties or shall I wait till the interest rates start to come down? In other words, is it likely to be more profitable for me to hold properties or am I better off selling now?

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Western Australia has the strongest economic momentum, unchanged from the October 2023 survey ranking according to State of the States comparison. Currently 3.11% pop growth. Prices tipped to Increase by a further 30% by mid 2027. A great time to ...Read full version

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Hi Michael, I am an Australian citizen living overseas. We left Australia in 1996 and have a property in Sydney. We have a great estate agent who has managed the property for us. We would really like to sell it soon, but the CGT for non-residents sel ...Read full version

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