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What’s going on in our property markets – facts and stats June 2014

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.

RPD1

 

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.

 RPD2

 

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.

 

rpd3

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.

 rpd4

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.

 

  • rpd5

 



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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


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