The Reserve Bank (RBA) released the minutes of the November 2015 board meeting earlier this week.
At the meeting the RBA decided to keep official interest rates on hold however, in the lead-up to the meeting there was some speculation that rates may be lowered.
Relating to the housing market the minutes noted: ‘Overall, the low level of interest rates continued to support the housing market.
Forward-looking indicators of housing activity generally pointed to further growth in dwelling investment, albeit at a moderating rate.
Auction clearance rates and housing price growth in Sydney and Melbourne had declined over recent months
Lending standards by banks had been tightened in response to changes in supervisory measures announced by the Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission and a number of lenders had announced increases in mortgage rates for both investors and owner-occupiers.
Notwithstanding questions over the accuracy of the components of housing credit data, overall housing credit growth had increased a little over recent months, with growth in lending to investors in housing easing slightly and that for owner-occupiers apparently picking up.’
The RBA also noted their forecast was for economic growth to gradually improve over the coming years as the non-mining sectors of the economy strengthened, but that would happen across a relatively low inflation and benign wage growth environment.
Data released from the Australian Bureau of Statistics confirmed that wages growth remained low, with the wage price index increasing 0.6% over the September quarter to be 2.3% higher overt the year which is a record low rate of growth.
With growth in wages only slightly higher than the rate of inflation, there is likely to be little in the way of inflationary pressures.
3,274 auctions were held over the past week, the second largest number of auctions held so far this year.
CoreLogic collected results for 90% of all auctions held. The weighted average clearance rate across the capital cities last week was 62.3% which is slightly higher than the 61.4% the previous week but lower than the 68.5% recorded a year ago.
Sydney had 1,223 auctions held last week and a clearance rate of 58.0%; the lowest auction clearance rate for the city since mid-February 2013.
1,567 auctions were held in Melbourne last week with a clearance rate of 69.8%.
Melbourne’s auction market has proved to be more resilient compared with Sydney, with auction clearance rates remaining higher than Sydney’s consistently since the second week of September. Last week’s
Melbourne auction clearance rate was the highest for the city in four weeks.
The national number of newly advertised properties was -5.3% lower relative to the same period one year ago to reach 51,350 properties added to the listings pool over the past twenty eight days.
Across the combined capital cities new listings are -4.1% lower than they were at the same time last year.
Canberra is the only capital city where new listings are higher than a year ago, up 12.7%.
The total number of properties available for sale is also lower than a year ago across both the national (-2.3%) and combined capital cities (-1.1%).
The capital cities with a higher number of total listings relative to a year ago are: Sydney (+4.2%), Perth (+9.3%) and Darwin (+12.7%).
In Sydney, total listings are now at their highest level since March 2013.
Higher listing numbers implies more choice for buyers which is likely to dampen any upwards pressure on value growth.
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