With the election result now clear our property markets can resume their normal activities.
And while the ALP fiddled around the edges with some First Home Buyer incentives, the absence of significant macro policy differences between the new Labor Government and the Coalition suggests minimal impact in the short term on our property markets.
However, as part of its election promises the Labor Party undertook to deliver a minimum wage rise to match inflation.
While this is dependent on Fair Work Australia endorsing it, the outcome is very likely to occur and will deliver some benefits but also some challenges including higher inflation (which is good for property owners) and higher interest rates to slow inflation.
However, prices are likely to soften further for now at least.
While the state of the jobs market and the economy remain strong, there have been undeniable signs through this year that demand demand for property is ebbing with lower auction clearance rates being a good sign of what's happening in the market.
Buyers now have more choice with more properties being listed for sale and are faced with the prospect of further rises in rates from the Reserve Bank, together with on-going cost of living pressures.
Overall Australian capital dwelling prices fell -0.1% so far this month of May to be 12.4% higher year on year.
On the other hand, capital city rental markets continue to tighten, with the record low vacancy rates still falling.
Here's what's happening to property prices...
- Sydney property prices dropped -0.3% from last week, decreased -0.6% from last month, and up 11.7% over the last 12 months.
- Melbourne property prices dropped -0.2% from last week, dropped -0.4% in the last month and up 6.6% over the last 12 months.
- Brisbane property prices are up by 0.1% from last week, increased 1.1% last month and up 28.6% over the last year.
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 May 23rd, 2022 provided by CoreLogic, and realestate.com.au.
The number of A-grade properties for sale in Australia is still in short supply
With dampening buyer demand, there are more houses on the market for sale, but currently, there is no oversupply as discretionary vendors are holding back – there is no reason for them to sell at present.
And remember that buyers are sellers and sellers are buyers so in most cases each time a property is sold another buyer is out in the market looking for a new home.
The table below shows how the stock of advertised properties is well below year-ago levels across the strongly performing capital city markets, but the tables are turning in favour of buyers in Melbourne and Sydney.
Median property prices
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At a national level, properties are taking slightly longer to sell than they were during the property boom of last year.
In the three months to April, the median days on market were recorded at 27, up from the recent low of 21 days in the three months to December.
However we're still in a seller's market with the number of days to sell the property very low (a sign of the tight supply situation), and vendor discounting at very low levels.
In general, houses are selling better than apartments, but the shortage of good properties on the market is seeing A-grade properties selling quickly with minimal discounting.
Our Rental Markets
Our rental markets have been tightening further with vacancy rates for both houses and apartments extremely low across the country.
Weekend's auction clearance rates
Dr Andrew Wilson reported...
Capital city auction clearance rates were generally lower at the weekend with buyers and sellers predictably distracted by Federal Election Day.
Auction markets however have clearly eased over recent weeks with confidence impacted by the shock decision by the RBA to raise interest rates for the first time in over 11 years.
The national auction market reported a clearance rate of 71.4% at the weekend which was the same as reported last weekend but lower than the 82.0% recorded over the same weekend last year.
Clearance rates continue to track at this-year-so-far low levels
Dr Andrew Wilson of My Housing Market reported Canberra was the stand-out performer with a preliminary auction clearance rate of 85.2%, from only 43 auctions.
Other preliminary clearance rates (as reported by Dr Andrew Wilson's Auction Insider) were:
- Brisbane auction clearance rate- 65.6%
- Melbourne auction clearance rate - 63.8%
- Adelaide auction clearance rate- 73.5%
- Sydney auction clearance rate- 68.9%
Source of graphs and data: Dr Andrew Wilson's My Housing market, CoreLogic, REA
READ MORE: This weekend’s auction clearance results