The number of new houses to be built in Sydney and Perth is set to jump over the next five years according to a new forecast by BIS Shrapnel. The report also found that house production in Melbourne and Adelaide will contract, but still be above their longer term averages. In Sydney, demand will pick up due to serious undersupply and rising house prices in the outer suburbs, making the relative cost of new homes attractive. Population growth in Perth will tighten rental vacancy rates and increase housing demand.
On that note, research released by the Committee for Perth has found that almost 90 per cent of homes in that city are currently unaffordable for essential workers including teachers, nurses, police officers and tradespeople like hairdressers and butchers. The median house price to income ratio has skyrocketed over the past decade, and rents have risen by more than 10 per cent in the last year. The gap between Perth’s haves in the resources and mining sector and have-nots continues to widen.
Meanwhile, it seems that first home buyers are getting back into the market. Home loans to owner occupiers rose 2.2 per cent in September, for the sixth straight month. It beat economists’ expectations, the market had expected a 1.5 per cent rise. First home buyer loans made up 16.4 per cent of the total. The strong numbers in Sydney are likely due to buyers rushing to make purchases before stamp duty exemption for homes below $600,000 ends at the end of the year. Much of the rise in owner occupier loans was due to refinancing, as consumers shopped around for a better home loan deal. New lending increased by just 1 per cent in the month. Construction of new dwellings dipped 0.2 per cent in September, and the purchase of new homes fell 0.7 per cent.
And the number of homes for sale reached just over 383,000 in October according to SQM Research. That’s 14.5 per cent higher than October last year. Hobart recorded the highest increase from the month before, with stock levels falling the most in Brisbane.
