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By Michael Yardney
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This week’s Australian Property Market Update – Latest Data, State by State May 21st 2024

key takeaways

Key takeaways

Australian home values continued to trend higher in April with CoreLogic’s national Home Value Index (HVI) rising 0.6%.

April’s increase takes the current growth cycle into its 15th month, with housing values up 11.1% or approximately $78,000 since the trough in January last year.

The preliminary auction clearance rate continued to fade last week, reducing to 71.1% across the combined capitals.

The result was 1.5 percentage points lower than the previous week’s result (72.6% which revised down to 65.1% on final numbers) and equal with the Easter long weekend to be the lowest preliminary clearance rate so far this year.

The softer result came with a reduction in volume, with 2,086 auctions held, down from 2,237 over the previous week but higher than a year ago when 1,921 auctions were held.

Sydney property prices increased 0.1% over the last week,  increased 0.4% over the last month and are 7.8% higher than they were 12 months ago.

Melbourne property prices remained flat over the last week,  dropped -0.1% over the last month, and are 2.2%  higher than they were 12 months ago.

Brisbane property prices increased by 0.3% over the last week, increased 1.1% over the last month and are 15.9% higher than they were 12 months ago.

Overall, Australian capital dwelling prices increased by 0.6% over the last month and are now 9.2% 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.

We're in the middle of the housing crisis, the likes of which I haven't seen in my five decades of investing.

And there is no end in sight.

Recently, the Reserve Bank Assistant Commissioner  Sarah Hunter gave some insights into our housing markets, explaining that currently we have about 2.5 people per dwelling and with the significant population growth we are experiencing, we just can't keep up with the supply of new dwellings.

The following chart clearly shows how both these factors have changed over the last couple of decades.

people per dwelling

And with more of us working from home, many of us require more space in our homes.

A zoom meeting on kitchen table no longer cuts it.

Working from home

Preliminary auction clearance rate continues to fade

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

The preliminary auction clearance rate continued to fade last week, reducing to 71.1% across the combined capitals according to Corelogic.

The result was 1.5 percentage points lower than the previous week’s result (72.6% which was revised down to 65.1% on final numbers) and equal to the Easter long weekend to be the lowest preliminary clearance rate so far this year.

The softer result came with a reduction in volume, with 2,086 auctions held, down from 2,237 over the previous week but higher than a year ago when 1,921 auctions were held.

See Corelogic's full auction report below.

This week, CoreLogic reports that:

  • Sydney property prices increased 0.1% over the last week,  increased 0.4% over the last month and are 7.8% higher than they were 12 months ago.
  • Melbourne property prices remained flat over the last week,  dropped -0.1% over the last month, and are 2.2%  higher than they were 12 months ago.
  • Brisbane property prices increased by 0.3% over the last week, increased 1.1% over the last month and are 15.9% higher than they were 12 months ago.

Overall, Australian capital dwelling prices increased by 0.6% over the last month and are now 9.2% higher than they were 12 months ago.

Clearly, the property cycle is moving on driven by an undersupply of good properties relative to steady demand from buyers.

Weekly Change 20 May

Monthly Change 20 May

12 Month Change 20 May

Source: CoreLogic May 20th 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.

The more expensive parts of our capital cities are likely to outperform this year as the local residence will, in general, have more equity in the properties they are selling, and they won't be as sensitive to high interest rates and the high cost of living as the outer and new suburbs.

Monthly Change In Hvi

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 20th May 2024 provided by CoreLogic, and realestate.com.au.

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 May 2024.

Sydney

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,929.037 14.246 1.7% 9.2%
All Units 799.682 -3.882 1.4% 5.4%
Combined 1,473.815 6.939 1.6% 8.0%

Source: SQM Research

Melbourne

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,253.811 0.589 -0.5% 6.8%
All Units 606.478 1.616 0.1% 2.8%
Combined 1,051.568 0.910 -0.4% 5.8%

Source: SQM Research

Brisbane

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,098.984 2.985 1.4% 15.4%
All Units 608.887 1.013 1.6% 19.5%
Combined 976.936 2.494 1.4% 15.9%

Source: SQM Research

Perth

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 985.057 4.283 0.6% 17.5%
All Units 512.702 4.998 1.3% 17.1%
Combined 862.234 4.469 0.7% 17.3%

Source: SQM Research

Adelaide

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 909.105 5.494 1.9% 16.5%
All Units 458.132 0.568 0.9% 11.3%
Combined 828.215 4.611 1.8% 16.0%

Source: SQM Research

Canberra

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,197.261 13.726 2.7% 15.0%
All Units 595.215 1.660 -0.1% 0.5%
Combined 978.622 9.344 2.0% 11.2%

Source: SQM Research

Darwin

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 663.359 0.041 -0.4% -2.7%
All Units 368.656 1.010 -0.7% -2.8%
Combined 547.732 0.421 -0.5% -2.7%

Source: SQM Research

Hobart

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 784.545 -4.364 -1.0% -0.6%
All Units 531.450 0.550 4.2% -0.2%
Combined 746.459 -3.624 -0.4% -0.6%

Source: SQM Research

National

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 919.394 0.882 1.0% 10.5%
All Units 543.909 4.278 1.0% 6.4%
Combined 839.080 1.608 1.0% 9.8%

Source: SQM Research

Cap City Average

Property type Price ($) Weekly Change Monthly Change % Annual % change
All Houses 1,381.548 6.332 1.5% 10.6%
All Units 674.954 0.491 1.1% 6.8%
Combined 1,173.789 4.615 1.4% 9.7%

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.

  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

Preliminary auction clearance rate continues to fade

The preliminary auction clearance rate continued to fade last week, reducing to 71.1% across the combined capitals.

The result was 1.5 percentage points lower than the previous week’s result (72.6% which revised down to 65.1% on final numbers) and equal to the Easter long weekend to be the lowest preliminary clearance rate so far this year.

The softer result came with a reduction in volume, with 2,086 auctions held, down from 2,237 over the previous week but higher than a year ago when 1,921 auctions were held.

Capital City Auction Statistics 20 May

Tracking the scheduled number of auctions, this week should see a rise in auctions held, with around 2,200 currently being marketed.

Melbourne was home to the most auctions last week, but the volume slipped below the 1,000 mark with 967 homes going under the hammer.

The preliminary clearance rate rose by 40 basis points to 68.4%, up from the previous week’s 68.0% which was revised down to 60.4%, the lowest finalised clearance rate since the Easter long weekend (60.3%) and well below the decade average of 66.6%.

Sydney clearance rates have been consistently higher than Melbourne’s, with the early clearance rate coming in at 74.9%, however, we are also seeing a fade in the success rate, with last week’s preliminary rate the lowest in four weeks.

At 68.7%, the previous week’s finalised clearance rate is holding slightly above the decade average (67.9%).

Among the smaller auction markets, Brisbane held the most auctions with 176 homes going under the hammer, returning a preliminary clearance rate of 69.6%.

146 auctions were held in Adelaide with 79.8% so far showing a successful result, and 66 auctions were held in Canberra with a preliminary clearance rate of 57.1%, the lowest since the last week of February.

 

City Clearance Rate Total Auctions CoreLogic auction results Cleared Auctions Uncleared Auctions
Sydney 74.9% 725 546 409 137
Melbourne 68.4% 967 713 488 225
Brisbane 69.6% 176 115 80 35
Adelaide 79.8% 146 89 71 18
Perth n/a 6 3 1 2
Tasmania n/a 0 0 0 0
Canberra 57.1% 66 42 24 18
Weighted Average 71.1% 2,086 1,508 1,073 435

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

Sydney

Property Type Rent ($) Weekly change Monthly change  12 Months change
All Houses $1,056.70 -4.70 -0.1% 9.5%
All Units $707.44 -2.44 -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 20 May

Listings 12 Month Change 20 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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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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