How often do we move and why; less unemployment and healthier auction results – another action packed three minutes of weekend reading.
1. Moving about
How often do people move house? The answer varies depending on how old you are and whether you are renting or own your own home. The latest ABS social survey indicates that 43% of Australians moved house over the last five years.
Only 16% or one in six owners without a mortgage – lucky buggers – moved recently; whilst close to every second owner with a mortgage moved since 2006.
Almost everyone (84%) renting (with a private landlord) moved residence over the last five years.
And just as there are stark differences in mobility across housing groups, the reasons for moving also varied markedly with wanting a bigger home (18%); purchasing own home (15%) or for family reasons (24%) dominating.
Interestingly, the proportion of people moving for employment was low (14%) on average across the country, but was much higher in Queensland (16%); Canberra (20%) and in the Northern Territory (26%).
Also of note was that just one in every 25 moves (4%) was because people wanted a smaller home or they were downsizing. This ratio lifted to one in seven (14%) for those who owned their previous home outright, or in other words, for older Australians.
The thirst for smaller accommodation isn’t high on the market’s agenda. Just 8% of Queenslanders with full ownership moved over the last five years because they wanted something smaller. For mine, this is because there isn’t enough attractive alternate housing stock freely available across Queensland, yet. But more about this next week.
Of note, too, is that most renters move in order to have a larger place (18%) and for employment reasons (also 18%), with very few opting for a smaller home. One in six renters is forced out of their current abode by landlords giving them notice.
2. Less unemployment
The ABS social survey also opens the debate as to the true level of unemployment.
This survey, the third of its type, after 2002 and 2006 studies, covers a total of 15,000 (well 15,028 to be exact) private dwellings. The monthly ABS labour force survey, by way of comparison, covers just 0.33% of the civilian population of Australia aged 15 years and over.
According to the monthly ABS labour force survey, the current unemployment rate is just over 5%. Other analysts believe the unemployment rate is closer to 10%. But the social survey responses suggest, on average, that only 3% of Australians regard themselves as unemployed – similar to the 2002 and 2006 surveys. This is also more in line with the data on unemployment beneficiaries.
The social survey count shows that 46% of the population work full-time; 19% work part-time and only 3% call themselves unemployed. One in five Australians is retired and one in eight (12%) is not in the workforce.
3. Auction results
Auction clearance rates continue to improve across the country. Last weekend, Melbourne achieved a clearance rate of 61% and Sydney’s rate was 60%. Both cities have been enjoying clearance rates over 50% for several months now.
As outlined before, resale values don’t increase unless auction clearance rates are consistently over 50%. Encouragingly, they appear to be on the right side of the ledger at present. This weekend’s pre-Easter super Saturday campaigns will speak volumes. Here’s hoping that they go well.
In my view, median dwelling prices will remain subdued across Australia on the whole for the next six to twelve months.
Yet affordability is on the improve, and outside of Sydney, Melbourne and Canberra, it now takes less than 30% of the average household income to buy a median priced property. This, combined with rising rents, limited new affordable housing; rising population growth and a reasonably strong (although adjusting) economy, will see end prices lift in due course.
Our outlook is for annual nominal price growth of between 2% and 4% across the country over the next five or so years. End prices across the Brisbane region – given its position at 6 o’clock on the property cycle – could rise faster. We are estimating an annual increase of between 5% and 7% each year for Brisbane. Sydney is also likely to be a winner with a 4% to 6% annual clip. Many regional centres, and especially those with four or more economic pillars supporting their local growth, could do even better.
Again, fingers crossed.
Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 550 new residential developments come to fruition and writes the weekly Matusik Missive. The Matusik Missive is free, however, reprinting, republication or distribution of any portion of this material, or inclusion on any website, is strictly prohibited without the written permission of Matusik Property Insights and may incur a charge.
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