admin-ajax.php

The secrets hidden in the property market

property market

Property data doesn’t tell us everything.

A closer look reveals the various markets going on within the big markets reported by the media.

Daniel Gradwell, senior economist at ANZ Research recently noted that while house prices in Sydney and Melbourne were likely to fall continue falling, when looking a little closer at the data, one can see that not all sectors of the market are behaving the same.

For example, there are differences across types of dwellings: detached house prices in Sydney are bearing the brunt of the falls with prices down 6.1 per cent year-on-year, while apartments are faring better, down just 0.7 per cent.

Sydney dwelling prices

The ANZ report suggests that this may reflect the impact of stamp duty discounts introduced for first-home buyers a year ago.

The discounted rates encourage first-home buyers into the lower end of the market, a price-range which naturally captures more units than detached houses – particularly in metro areas.

The additional demand is supporting prices in this segment.

Victoria

Similar impacts can be seen in Victoria, where the prices of the lowest 25 per cent of properties have actually increased 9.3 per cent year-on-year, compared with the overall Melbourne market which is up just 1 per cent.

Melbourne house prices

Regional markets are outperforming

Another theme ANZ Research is seeing is that capital cities are lagging behind regional areas.

While Melbourne prices are up 1 per cent year-on-year, prices across the rest of Victoria have accelerated in recent months, rising 4.9 per cent year-on-year.

Melbourne house prices

Similar discrepancies can be seen in New South Wales with Sydney prices down 4.5 per cent year-on-year compared with the rest of the state actually being 3.3 per cent higher year-on-year.

In my mind this does not suggest you should be investing in regional Australia

This short term trend could be attributed to a recent focus on credit tightening which is having a greater impact on the more highly leveraged Sydney and Melbourne markets compared with the more affordable regional areas. 

1-percent

Western Australia is slowly looking better.

Prices in the state (excluding Perth) have increased for the past four months which is the best run since the mining boom was in full swing in 2010.

Business investment data suggest the end of the decline in mining investment is nearly here and the prospect of greater stability in the population and employment should provide some support to prices.

But ANZ suggests it’s not time to get too excited yet as house prices are still around 30 per cent lower than the peak a decade ago.

WA house prices

The bottom line

ANZ concludes that these divergences remind us a singular Australian housing market does not exist.

Important nuances are at play across the country and across price points.

While confidence in Australian housing has clearly been retreating in the face of affordability concerns and tightening credit policies, it is important to keep in mind these issues do not affect everywhere equally.

Read more at ANZ Research



icon-podcast-large

SUBSCRIBE & DON'T MISS A SINGLE EPISODE OF MICHAEL YARDNEY'S PODCAST

Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.

 

NEED HELP LISTENING TO MICHAEL YARDNEY'S PODCAST FROM YOUR PHONE OR TABLET?

We have created easy to follow instructions for you whether you're on iPhone / iPad or an Android device.

icon-email-large

PREFER TO SUBSCRIBE VIA EMAIL?

Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.


Avatar for Property Update

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 his opinions are regularly featured in the media. Visit Metropole.com.au


'The secrets hidden in the property market' have no comments

Be the first to comment this post!

Would you like to share your thoughts?

Your email address will not be published.
CAPTCHA Image

*

facebook
twitter
google
0
linkedin
0
email

Michael's Daily Insights

Join Michael Yardney's inner circle of daily subscribers.

NOTE: this daily service is a different subscription to our weekly newsletter so...

REGISTER NOW

Subscribe!