Weekly Market Update (6 Oct 2023)

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Weekly Market Update (6 Oct 2023)
  1. Home Value Index (Source: CoreLogic)

    CoreLogic’s national Home Value Index (HVI) showed a 0.8% increase in September, marking the eighth consecutive month of growth. This follows a 0.7% rise in August, bringing the quarterly pace of growth to 2.2%. Adelaide, Brisbane, and Perth recorded the highest capital gains in the September quarter, while Hobart saw a decline in home values. The upper quartile of the housing market has experienced a slowdown in growth, while the middle market is now recording the highest growth rate. Regional markets are lagging behind the capitals, with weaker growth conditions and lower home sales. Overall, the national housing market is expected to recover to a new nominal high by the end of November.

    The CoreLogic Home Value Index can be downloaded on corelogic.com or our Square Real Estate website at https://www.squareqld.com.au/advice/the-real-estate-report/.

 

  1. Population Shift (Source: ABS)

    New data from the Australian Bureau of Statistics (ABS) reveals that people are moving away from New South Wales (NSW) and Victoria and relocating to Queensland and Western Australia. This shift is attributed to the affordable real estate and attractive lifestyle in these states. The ABS data shows that 35,857 people left NSW and Victoria, while Queensland and Western Australia saw a combined population increase of 42,191 due to interstate migration. Property expert Samuel Powell believes there will be further capital gains in these states, as Brisbane and Perth have already experienced growth in housing prices. He also points out that Queensland’s hosting of the 2032 Olympics and the recovery of global economies will benefit the state’s economy. In terms of suburbs, Brisbane’s Oxley, Boondall, and Fitzgibbon, as well as Ipswich’s Churchill, are well-placed for growth in Queensland.

 

  1. Cash Rate (Source: RBA)

    The Reserve Bank of Australia has decided to leave the cash rate target unchanged at 4.10 per cent and the interest rate paid on Exchange Settlement balances unchanged at 4.00 per cent. Interest rates have been increased by 4 percentage points since May last year. While the Australian economy has shown stronger-than-expected growth, it is still experiencing below-trend growth, with weak household consumption and dwelling investment, and the unemployment rate is expected to rise gradually.

 

  1. National Residential Property Listings (Source: SQM Research)

    Australia saw a sharp rise in property listings in September, with a 9.3% increase compared to August. This surge can be attributed to a substantial rise in new listings across all capital cities. Distressed property listings increased by 1.3%. Asking prices for capital cities also increased, with a notable surge in asking prices for all units. The report suggests that the increase in listings reflects confidence from vendors and provides more choices for buyers. However, caution is advised as there are vendors with unrealistic pricing expectations.

 

  1. Rental Market (Source: Domain)

    Australia’s rental market continues to favor landlords, with a shortage of rentals and record-low vacancy rates. House and unit rents have reached record highs across most capital cities, with Melbourne losing its status as the most affordable city to rent a house and Brisbane becoming the second most expensive city to rent a unit. Rent growth has slowed but remains elevated compared to historical standards. Factors contributing to the tight rental market include limited supply, population growth, and investor reluctance. The rental market varies across cities, with Sydney being the most expensive, while Hobart is now the most affordable.

 

  1. Rental Crisis (Source: Trent Alexandar)

    Australia is facing a worsening rental crisis as property investors sell their properties due to restrictive legislation and increased costs. A survey by the Property Investment Professionals of Australia (PIPA) shows that a significant number of investors have sold properties in Melbourne and Brisbane, as well as regional areas in Queensland and Victoria. The main reasons for selling are changes in tenancy legislation, higher costs, and the threat of increased taxes and levies. This exodus of investors is exacerbating the rental crisis, as there is already a shortage of rental homes. Despite this, Western Australia is becoming increasingly attractive to investors, while Queensland’s appeal has declined. The survey also found that more investors are likely to sell in the next year, which will further impact rental availability. However, there is still an opportunity for long-term investors to take advantage of the current market conditions and high demand for rental properties.

 

  1. CoreLogic Auction Results (Week ending 1 Oct 2023)
    (Total Auction / Clearance Rate)

    – Sydney: 714 / 64%

    – Melbourne: 203 / 66.5%

    – Brisbane: 109 / 63.3%

    – Perth: 15 / 46.7%

    – Canberra: 72 / 58.3%

    – Adelaide: 83 / 72.3%

    – Tasmania: 2 / 100%

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If you’re interested in staying updated on the Australian housing market, feel free to reach out to us. You can also follow our Facebook page and Instagram for regular updates on new listings, market trends, statistics, and insightful information.

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