Housetheir strong upward trajectory in September, with values rising 1.5%. The latest data from CoreLogic paints a bullish picture for homeowners, with dwelling values now 20.3% higher in the past 12 months, a growth level saw back in 1989. Once again, every in September, with Hobart and Canberra again the best performers, increasing in value by 2.3% and 2.0%, respectively. Sydney, Adelaide, and Brisbane all saw strong growth of nearly 2%, while Perth and Darwin were the weakest capital cities, with gains of just 0.3% and 0.1%. Regional Australia also continues to see intense growth levels and has outpaced its city counterparts for another month. In October, regional areas grew by 1.7%, taking the annual to 23.1% in a stellar period for housing outside the big cities.
Head of Research at CoreLogic, Tim Lawless, says thatdespite a solid 12 months, easing back from record-high levels. “With rising substantially faster than household incomes, raising a deposit has become more challenging for most market cohorts, especially first home buyers.” “Existing homeowners looking to upgrade, downsize or may be less impacted as they have had the benefit of equity accrued as housing values surged.” Along with low-interest record rates, another key ingredient in the current of stock highlighted by very few properties listed for sale.
Although new seller’s market even with listings rising. “Nationally, homes are selling in 35 days, up from 29 days in April, and levels remain around record lows at -2.8%. Another factor pointing to strong selling conditions is the in auction clearance rates. Restrictions relating to one-on-one were eased mid-month across Melbourne and Canberra. By the end of September, the combined capital clearance rate had returned to 80.5%, its highest since late March.”low. Across the country, total advertised supply levels are -28.1% below the five-year average, and every capital city is of advertised supply. Mr. Lawless says that we’re still in a
Thanks to the substantial period of capital growth, rental yields have. Gross yields across the combined capitals have fallen to 3.0% in September, with horrendous results in Sydney (2.5%) and Melbourne (2.8%), well below the other money., while is higher at 4.4%. CoreLogic suggests that, although yields are low, so too are investor mortgage rates. In July, the average three-year fixed rate for a new investor loan was 2.38%, while variable rates averaged 3.01%, suggesting opportunities for favorable cash flow outside of Sydney and Melbourne.
Positive Outlook for Property Prices
According to CoreLogic, the trend foraround Australia remains positive. that mortgage rates will stay at record lows for an extended time while solid demand is occurring alongside persistently low advertised supply levels. However, there are several factors on the horizon that investors of. While the RBA has made it clear for an extended time, we’ve recently heard from APRA (Australian Prudential Regulation Authority). They are looking at tighter debt-to-income ratios and the readdition of higher serviceability buffers, new loans. Additionally, with lockdowns easing in the weeks ahead, the expectation is that stock levels will continue to , which can potentially change the buyer-seller dynamic that we’ve seen for the past 12 months.