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4 things I learned this week that you should also know - featured image
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4 things I learned this week that you should also know

A lot can happen in one week in our property markets, can't it?

So here's a look back at some of the things I read or learned this week, that I believe you should also know.

1. We're now in a buyer's market

  • We've moved from a boom-time sellers' market into more of a buyer's property market.
  • At a national level, properties are taking longer to sell.
  • In the three months to July, the median days on market was 32, up from a recent low of 20 days over the three months to November.
  • Similarly, vendor discounting has increased from a recent low of -2.8% recorded in three months to April last year.
  • In the three months to July the median vendor discount at the national level was -3.8% -so vendors are really not having to slash their prices, despite what the media tries to tell us.

Median Vendor Discount 3 Months To July 2022

Median Days On Market 3 Months To July 2022

2. Regional prestige lifestyle areas are the first to show market weakness

After COVID lockdowns fuelled record-breaking growth rates among many of Australia’s regional lifestyle areas, NSW and Queensland’s beach and country hot spots have been the first to register a quarterly fall in house values.
CoreLogic’s latest quarterly Regional Market Update shows the largest 25 non-capital city regions all recorded an increase in house values for the year.
NSW’s Riverina region was the best performer among regional house markets, with an annual increase of 27.8%, followed by Wide Bay (Qld) and New England and North West (NSW), up 26.8% and 26.4% respectively.
The lowest yearly growth rate was recorded across Ballarat in Victoria (7.4%), followed by Bunbury in Western Australia (9.5%).
Annual figures show regional dwelling values jumped 17.0%, outpacing the combined capitals, which saw dwelling values rise 5.4% over the same period.
Despite the widespread capital gains in regional house values, 10 regions recorded values declines in the three months to July.
The growth in regional dwelling values has slowed from a peak of 6.4% in December last year to -0.2% over the three months to July 2022.
Houses Chart
Units Chart

3. Rental market competition heats up as visa applications surge

According to the Home Affairs Department, the number of international students applying for visas hit a record high in June as city life and international travel resumed.
In an update sent to education providers, the department stated, “this is the largest number of offshore applications received in a single month in the last 10 years”.
Finding a rental property at the moment is already tough for would-be tenants, with significant competition and little choice.
A surge in international student arrivals is likely to add further pressure to already tight rental markets in Aussie capitals.

Median Days On Site For Rental Listings

4. Where are all the students and backpackers? 

We know unemployment is very, very low.
Some labour market tightness is due to a slower resumption of migration.
Some signs that this may improve with student visas granted back to pre-pandemic levels - see the attached chart
China's zero-COVID policy is a key uncertainty here given that Chinese students comprised around 30% of all foreign students pre-pandemic.
Australian Visas For Students

About 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. Visit Metropole.com.au
18 comments

Linda, you have a number of options and holding onto a period property in a good location like Newington in the long-term is one of them, rather than swapping and changing. However I don't know your personal situation, or your cash flow, or what yo ...Read full version

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Hi Michael, I invested in a Victorian period residential property in Newington - central Ballarat Victoria just before the current downturn. No one saw it coming! Previous capital growth has been strong before I bought in the area but has gone negat ...Read full version

1 reply

Suresh - I can't answer this for you without knowing what your current situation is, what your budget is, what your cash flow position is, how risk averse you are. However I can say this is the location that is definitely not on our radar and will un ...Read full version

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