Property Pulse
18 June 10
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Pre-listing activity remains at high levels although it has eased by -2.5% over the last week. Despite the easing, which is probably attributable to a long weekend in most states, pre-listing activity remains at high levels. Given this, we anticipate that the high number of new listings coming to the market will persist over the coming weeks.
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Dwelling commencements data released by the Australian Bureau of Statistics (ABS) this week showed that total dwelling starts, including conversions, increased by 4.3% over the quarter and were at their highest level since June 2004. New housing was the only sector which fell during the quarter, with commencements down -2.1% for the period, in comparison other residential commencements increased by 22.1% for the quarter.
Overall the result is very positive with total house commencements 31.5% higher than at the same time last year, total other residential commencements were 44.8% higher than the previous year and total conversions were up 25.2%. The lingering worry is the fact that during April 2010 there was a sharp decline in approvals for private sector houses and units. Historically there has been a very strong correlation between approvals and commencements and should this downwards trend persist for approvals we will likely see weakening results for dwelling commencements next quarter.
Advertised Stock on the Market
 The volume of new property listings entering the market over the last week fell by -13.7% however, this substantial fall is again likely due to the long weekend in most states and we fully expect this to bounce back next week. Total listings also fell last week however, the fall was much smaller (-1.7%). Given the apparent slowing of the property market it will be important to watch total listings closely during the coming weeks to see if stock levels begin to mount.
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Latest National Auction Clearance Rates
 Auction clearance rates fell again last week, the fourth consecutive week of declines. The national weighted average auction clearance rate was recorded at 60.6%. For six weeks now the weighted average auction clearance rate has been recorded below 65%, clearance rates haven’t consistently been this soft since March 2010. Melbourne’s auction clearance rates increased slightly last week to 68.7%. Sydney’s auction clearance improved slightly last week to 65.1%. Nationally the volume of auctions fell largely last week as many avoided taking their property to auction over the long weekend.
Want to know the auction results for your local area? Log into rpdata.com and go the Auction Results panel on the top right corner of the home page.
Number of Properties Advertised for Rent
 A big fall in rental listings was recorded last week, again this is likely attributable to a long weekend across most states. New rental listings were at their lowest levels since late January 2010. Total listings also recorded a sharp fall of -8.8% during the week.
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Where can the average buyer afford to purchase?
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Housing affordability remains an issue however, there are still options for the price sensitive purchaser… they just need to target areas further away from the CBD.
Housing finance data released last week showed that across the country non first time buyers in New South Wales had the greatest average loan size at $315,400 and Tasmanian’s were taking out the smallest average loans at $194,000. It is extremely rare that anyone would be receiving a 100% loan so for the purposes of the following analysis we have assumed that borrowers have a 10% deposit, therefore they are borrowing 90% of the total value of the loan. Based on this assumption we can determine their borrowing power which indicates how much the purchaser could have potentially purchased a property for.
On average, purchasers in New South Wales demonstrated the greatest buying power, spending on average $350,444 and Tasmania purchasers had the least amount of buying power at $216,556. This outcome is to be expected and reflects the characteristics of these markets with New South Wales having the most expensive property market and Tasmania the most affordable.
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Read the full article... |
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Australian Market Update-
June 2010
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 The RP Data Research Analysts have compiled 28 graphs focused on the Australian Property Market. Included in the presentation are graphs showing Median House and Unit Prices, Annual Change in Dwelling Values and National Capital Growth and Sales Volume.
Click the button below to download the June 2010 presentation.
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Commercial: Port Melbourne shop sold
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 Agents of Fitzroys and Gross Waddell have sold a shop situated within a new development in Port Melbourne, Victoria.
Shop 1 in the Bianca Apartments at 120 Bay Street, Port Melbourne, was sold with a new lease in place to Woolworths, trading as Thomas Dux.
Fitzroys agents, Geoff Emmett and David Bourke, and Gross Waddell agents, Jonathon McCormack and Andrew Waddell, marketed the shop, which sold at auction for $4.6 million.
The new seven-year lease at a current projected net rental of $340,000 per annum plus GST gave the sale a yield of approximately 7%.
Comprising an open plan retail area of approximately 954 sqm including mezzanine of approximately 132 sqm with frontage to Bay Street, the internal arcade and direct travelator access to the basement car park for 120 vehicles, the property is located in a prime retail section of Bay Street, Port Melbourne that is expected by the selling agents to benefit from the “explosion” in residential high rise development that has taken place and projected to occur over coming years.
The property had previously been offered for auction in December 2009 but was withdrawn from the market.
Stay up-to-date with the latest commercial property news all in one place. Subscribe to the Australian Property Review for only $1.90 a week and receive a weekly newsletter that includes Auction Results, Deals of the Week, Retail News, Leasing Deals and an Industry Market Update. Click here to find out more information.
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Blog: Housing bubble? Not here.
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It’s nice to see that Jeremy Grantham has rolled into town this week and stirred up the property bubble argument once more. Mister Grantham, the co founder and chief investment strategist of US based investment management firm Grantham, Mayo, Van Otterloo & Co (or GMO), has been widely quoted during his tour across Australia saying that Australian property prices are in a bubble and need to fall 42 per cent to revert to trend (42 per cent, he’s even more bearish than one noted local bear who bet on 40 per cent falls). Whilst in Australia Mister Grantham has also commented on Australia’s proposed Resources Super Profits Tax, the UK and Chinese Property markets.
Whilst one can’t argue that capital city prices are expensive and unaffordable for many, capital cities do not make up the entire Australian property market. There is such a focus on the capital city property markets due to the fact that this is where the majority of Australian’s live. Over the three months to April 2010 the median house price in Australian capital cities was $492,000 and the median unit price was $410,000. When you combine all areas of the country including those outside of capital cities the median price falls to $425,000 for houses and $382,500 for units. The median price for all dwellings (houses and units combined) is $414,000. Clearly national median prices are heavily influenced by the capital city markets however prices are generally much more affordable once you move out of the capital cities.
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Read the full article at blog.rpdata.com... |
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