The trend that is sweeping Australian real estate, the one we call The Exodus To Affordable Lifestyle, started in Regional Victoria.
It has been, and continues to be, a strong trend elsewhere in Australia – but it first became apparent in Victoria. And it continues to be a powerful force there.

This significant demographic shift has been incorrectly reported in mainstream media as being a consequence of the pandemic lockdown period. In reality, The Exodus To Affordable Lifestyle started well before 2020.

It has been driven primarily by technology – which has created the ability for more and more people to work remotely – and has been enhanced in some instances by improved transport links.
News

Quote of the Week

“It is quite remarkable that we are in the midst of the biggest economic downturn in a generation and yet new lending for homes is pushing higher at an accelerating pace.”

CBA Economics report

News

Aussies Have Saved $100 bil In 7 Months

Australians have amassed $115 billion in total savings as a buffer against the pandemic recession, in a sign that economic recovery is unlikely to be derailed by any future reduction in government income support.
APRA figures show household deposits surged to $1.09 trillion by the end of September – an increase of $115 billion in 12 months and a $99.5 billion increase on deposit levels in February, before the pandemic took hold.
NAB director of market economics Tapas Strickland says that, just as the tens of billions in emergency support helped soften the virus recession, the savings amassed recently will help households navigate any drop-off in income payments over coming months.
There is mounting optimism the economy is recovering after a 7% contraction in the June Quarter. RBA deputy governor Guy Debelle said last week he expected the economy to have grown in the September Quarter, which technically would end of the pandemic recession. 
Surveys show that, outside Victoria, consumer confidence has staged a dramatic recovery to sit at pre-pandemic levels.

News

Investors Wake Up To Emerging Boom

The many strong property markets around Australia have been uplifted primarily by owner-occupiers, including first-home buyers – but the latest loans data suggests that investors are starting to join the buying trend. The number of property investor loan commitments has returned to pre-pandemic levels, according to figures from the Australian Bureau of Statistics. The ABS Lending Indicators for September indicates that more than $5 billion of new investor loan commitments were recorded that month – a similar value to February 2020 before the onset of the pandemic impact. 
The number of investor loan commitments also increased 5% in September, after recording a monthly rise of 9% in August, according to the ABS. 
Real estate professionals across Australia report rising activity from investors who are increasingly aware of strong markets, with rising prices and very low vacancy rates, particularly in regional Australia and the smaller capital cities.

News

House Prices Rise In Sept Quarter

The latest price data from Domain shows strong uplift in house prices right across Australia. Every capital city had growth in their median house prices in the September Quarter – except Melbourne where there was no change.

In the September Quarter, house prices grew by 2.8% or more in four of the capital cities: Adelaide, Hobart, Darwin and Canberra.  Hobart rose 6.9% and Darwin by 6.6%. 

In annual terms, all capital cities have house prices higher than a year ago. The national average is a rise of about 5% but individual cities have done much better: Hobart has risen 16% and Canberra is up 10%. Sydney, Adelaide and Darwin have all risen 7%.

This reflects the month-by-month data from CoreLogic since the start of the pandemic.  Canberra has produced price growth in each of the past seven months and Adelaide has had growth in six of the seven months. Perth, Brisbane and Darwin recorded some down months, but bounced back in August and September. 

Most regional markets have had sustained growth throughout the pandemic period, with Regional Tasmania up in every one of the past seven months, while Queensland and NSW delivered uplift in six of the seven.

News

Buyer Demand Outweighs Home Supply

Nationally, residential sales are outpacing new property listings, vendor discounts are falling and it’s taking less time to sell a property, shows the latest CoreLogic data. 
The median vendor discount eased across capital cities and regional areas in the three months to September, falling from 4% to 3.3% over the year. Also, it now takes an average of only 40 days to sell a property compared to 46 days a year ago, the data shows. 
“The year-on-year comparison is highly relevant as a year ago the marketplace was emerging from a two-year downturn,” says Tim Lawless, CoreLogic’s head of research. “It does show that, as we emerge from the COVID-related lockdowns, the market seems to be a little bit stronger than that.”
In the four weeks to September 27, new listings rose 9% while total listings declined, leaving the ratio of home buyers to new listings weighted towards demand rather than a supply build-up, says Lawless.
This suggests that now is the right time to buy.

News

Affordability Best Since 2009: Moody’s

Housing affordability is at its best level since 2009 because of low interest rates and falling house prices in the biggest cities, says Moody’s Investors Service. “Housing affordability improved in Sydney, Melbourne, Brisbane, Perth and Adelaide over the year to September,” says Moody’s vice president Alena Chen.
House prices fell, on average, 1.5% over the five months to September, though prices are still up 3.2% over the year – and most the price decline has occurred in the two biggest cities.
On average, Australian households need 23% of their monthly income to meet mortgage repayments, compared with 25% a year ago and 26% on average over the last 10 years. Sydney remains the least affordable, with new borrowers needing 30% of household income to meet repayments, compared with 25% in Melbourne. But borrowers in Adelaide and Brisbane need only 19% of their household income for their mortgages while Perth is the most affordable city, needing to just 15%. 

News

We Believe Recession Is Over: RBA

Reserve Bank deputy governor Guy Debelle says the RBA now believes the country’s first recession in three decades ended in the September Quarter. “As best as we can tell, the growth elsewhere in the country was more than the drag from Victoria,” he says. Ahead of a highly-anticipated RBA board meeting next Tuesday – when the cash rate is likely to be reduced by a further 0.15 percentage points to 0.1% – Debelle told Senate estimates that “our best guess is it looks like the September Quarter recorded positive growth rather than slightly negative”.
“And as best as we can tell, the growth elsewhere in the country was more than the drag from Victoria, and possibly the drag from Victoria was a little less than what we guessed back in August,” he says.
The RBA will release a new set of forecasts in its quarterly Statement on Monetary Policy (SOMP) next Friday.
The bank’s August SOMP said “the effects of the heightened activity restrictions in Victoria are likely to offset the pick-up in GDP growth in other parts of the economy in the September Quarter”.

Uncategorised

Auctions Outcomes Continue To Improve

Auction volumes increased from 13,783 to 14,216 (up 3%) in the September Quarter, according to CoreLogic.

“The combined capital city auction clearance rate increased over the three months to September, returning a clearance rate of 59%, up from 48% over the June Quarter, which was the lowest seen since the December 2018 Quarter (44%).

In the past week, Sydney had 707 properties go under the hammer, accounting for 60% of all auctions, but Melbourne had its biggest weekend of auctions in two months with 188 homes going to auction – up on 59 in the prior week.

Among the smaller auction markets, Canberra was the strongest, recording an 86% clearance rate with 49 of 59 auction results collected.

Brisbane recorded a preliminary clearance rate of 55% with 74 auctions scheduled; Adelaide recorded 71% from a similar number of auctions; and Perth managed 55% from just 26 auctions.

Nationally, CoreLogic reported a 72% preliminary clearance rate from 1,134 auctions, up from 72% a week prior.

Onsite auctions return to Melbourne this week.

News

Economy Will Recover Quickly: Deloitte

Australia’s economy is forecast to rebound quickly, growing by 3.4% on average over the next five financial years, according to the latest Business Outlook from Deloitte Access Economics.

Deloitte partner Chris Richardson says: “If things go right, and virus numbers go right, you genuinely start to get a beautiful recovery”.

Richardson says previous recessions or downturns in Australia had been followed by times of faster growth as workers and ­industries resumed ­activity.

“The point that people have not understood is we will grow really fast when we come out of this,” he says. And “the bigger the downturn, the bigger the ­recovery”.

Deloitte forecasts that after contracting by 2.5% in this financial year, real GDP growth will grow by 4.4% in 2021-22, and 4.1% in 2022-23, before tailing off to 2.8% by the middle of the ­decade.

Richardson expects the recovery to be supported by low interest rates which he says will be “flat to the floor” until mid-2024.

News

Investors Turn Focus To Smaller Cities

Smaller cities can expect an increase in demand from investors as the big cities lose their appeal in the wake of Covid-19, according to new research from CoreLogic. 

CoreLogic head of research Eliza Owen says Covid-19 triggered a retreat of investors from favoured markets like inner city Sydney and Melbourne.

From an affordability and yield perspective, smaller capital city markets could grow in popularity with investors in the coming months, while the larger cities are unlikely to regain ground “until overseas migration and travel resumes”, she says.

At present, Brisbane, Perth and Adelaide offer much higher yields than the southern capitals because of lower dwelling values.

The latest ABS housing finance data shows current investor participation is 24%, well below the decade average of 36%.

Investor activity has been reduced because investor loans attract a higher interest rate, there is less appetite by lenders for high LVR and interest-only lending, the reduction of rental returns in the big cities, and the shocks caused by the pandemic.

News

Confidence In Housing Market Booms: Westpac

Confidence in the Australian housing market is rising, with a Westpac consumer survey revealing a strong uplift in consumer sentiment.

The national “house price expectations” index grew by 32% to 117, with all states registering a double digit increase.

The national “time to buy a dwelling” index increased 11% in the past month to 122, rising to its highest level since September 2019.

Westpac chief economist Bill Evans says it as an extraordinary result, stating the overall consumer sentiment index was up 32% in the past two months, and 10% above the average level in the six months prior to the pandemic.

“Such a development must be attributable to the response to the Federal Budget; ongoing success across the nation in containing the Covid-19 outbreak; and the expectation that the Reserve Bank board is likely to further cut interest rates at its next meeting on November 3.”

There was also a “stunning lift” in confidence around job security, says Evans, with the index improving by 14 to early 2019 levels. 

1 2 3 4
Privacy Settings
We use cookies to enhance your experience while using our website. If you are using our Services via a browser you can restrict, block or remove cookies through your web browser settings. We also use content and scripts from third parties that may use tracking technologies. You can selectively provide your consent below to allow such third party embeds. For complete information about the cookies we use, data we collect and how we process them, please check our Privacy Policy
Youtube
Consent to display content from Youtube
Vimeo
Consent to display content from Vimeo
Google Maps
Consent to display content from Google
Spotify
Consent to display content from Spotify
Sound Cloud
Consent to display content from Sound