Here’s a summary of what’s going on in Australia’s property markets around Australia using data from RPData’s latest charts.
There’s been a lot going on and it paints an interesting picture with many mixed signals, so here’s what’s happening in easy to follow bullet point form with a few significant charts thrown in for explanation:
Capital city home values fell by -1.9% in May…
This is their first fall in a year, however they have increased by 0.7% over the three months to May 2014
- Home values fell by -1.9% across the combined capital cities in May however, it is likely to be largely a seasonal phenomenon with values falling in each of the past three May’s.
- Over the month, home values fell across each capital city except for Darwin and Canberra.
- Over the three months to May, capital city home values rose by 0.7% and were higher across each capital city except for Melbourne where they fell by -1.9% and Perth where they were unchanged.
- Capital city home values rose in each capital city over the past year, the greatest increases were recorded in Sydney (16.6%), Melbourne (9.9%) and Darwin (9.7%) with all other capital cities recording value growth of less than 6.0%.
- Combined capital city home values have now moved 5.5% past their historic highs across the combined capitals with values in Sydney, Melbourne, Perth and Canberra now above their previous peaks.
- Looking at value movements across broad price segments in the market over the year, the top 25% of capital city suburbs have recorded a value increase of 11.1% followed by a 10.9% increase across the middle market suburbs and a 9.2% increase across the most affordable suburbs.
Sales activity across the country continues to trend higher
- Over the three months to March 2013 there was 82,051 house sales across the country which was 7.9% higher than over the same period in 2013.
- There were an estimated 30,471 unit sales over the three months to March 2014 which is 4.0% higher than over the same period in 2013.
Rental rates have risen at a slow rate over the past year, but not at a fast enough pace to result in any increase in yields
- Capital city house rents have increased by 2.2% over the year to May 2014 compared to a 2.8% increase in unit rents, both of which are well below value growth figures over the year.
- Gross rental yields for houses have fallen from 4.2% a year ago to 3.9% currently while unit yields have decreased to 4.7% from 5.0% a year ago.
Vendor discount levels and the average number of days on market have improved from the same time last year
- Based on private treaty sales, vendors were discounting their initial selling prices for homes by -5.6% in April 2014 compared to -5.9% a year earlier.
- The average number of days it took to sell a home is currently recorded at 37 days compared to 48 days a year ago.
Economic data flows remains mixed buy is generally more positive than negative
- Headline inflation increased by 0.6% over the March 2014 quarter and is recorded at an annual rate of 2.9% and core inflation is at 2.6%.
- The Australian economy grew by 3.5% over the 12 months to March 2014.
- Households savings levels are trending lower and were recorded at 9.7% in March 2014.
- No change was made to official interest rates by the RBA at their June board meeting with no change to interest rates in 10 months.
- The unemployment rate was steady at 5.8% in April 2014 but up from 5.6% at the same time in 2013.
- Consumer confidence has been trending lower since September 2013 and in May it fell to 92.9 points, its lowest level since August 2011.
- The total number of first home buyer finance commitments in March 2014 had fallen by -0.8% year-on-year with first home buyers accounting for 12.6% of all owner occupier finance commitments.
- Overall owner occupier housing finance (ex-refi’s) have increased by 5.4% year-on-year while refinance commitments are up 11.6% year-on-year.
- The value of finance commitments for investment purposes is 27.9% higher year-on-year to March 2014 and investors account for 39.1% of all finance commitments, sitting at a level close to their highest proportion since October 2003.
- Private sector housing credit has grown by 6.1% over the 12 months to April 2014, its highest annual rate of growth since May 2011.
- Dwelling approvals were 1.1% higher year-on-year in April 2014. The annual number of dwelling approvals is 16.5% higher over the year and at its highest level since the 12 months to January 1995.
- Population growth over the 12 months to September 2013 increased by 1.8% of 405,446 persons.
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