The latest quarterly rental data released by Fairfax Media subsidiary Australian Property Monitors as well as SQM Research suggest a continued two-speed rental market. On a national level capital city rents rose by 4.2 per cent for houses and 2.4 per cent for units over the year to September. Rental growth in Melbourne, Adelaide and Hobart achieved little or no growth. Darwin has shown the strongest growth over the year with weekly house rents $180 above Sydney and $272 above the national capital city average. Darwin’s weekly unit rents were also well above Sydney’s and the national average.
Two banks have provided a cautious economic outlook this week. Addressing Commonwealth Bank of Australia’s
(ASX:CBA) annual meeting, Chairman David Turner has warned global financial instability will continue beyond next year. Mr Turner says the medium to long term economic climate in Australia also remains uncertain with subdued credit demand expected. Mr Turner’s remarks follow Bendigo and Adelaide Bank Limited’s
(ASX:BEN) Chairman’s warnings earlier this week, who said the financial crisis will continue for at least another five years.
Residential sector
New home sales in Australia have plummeted to an 18 year low. According to the Housing Industry Association, new home sales dropped for the third straight month, down 3.7 per cent in September, following a fall of 5.3 per cent the month before.
Building approvals have lifted, coming in above expectations. The Australian Bureau of Statistics has reported residential building approvals increased 7.8 per cent in September. Over the year, approvals were up more than 12 per cent.
The latest quarterly house price study from Australian Property Monitors shows home values were flat in the three months to September. There was a 0.1 per cent rise annually. The biggest falls in the quarter were Hobart with a 2 per cent fall, and Adelaide, which lost 1 per cent.
Auction results
The biggest auction day of the year, known in the industry as “Super Saturday”, which falls between the football grand finals and the Melbourne Cup, saw more than 2400 properties nationally fall under the hammer.
Sydney recorded a 62 per cent clearance rate from 403 properties for auction, Melbourne was also solid, clearing 65 per cent from 450 properties, Brisbane had a 23 per cent clearance from 42 properties listed and Adelaide picked up, clearing 57 per cent from 34 reported auctions.
Commercial property sector
Property investor Goodman Group
(ASX:GMG) says its capital raising for its Australian industrial property fund was on track and well placed to raise $400 million by the end of the year. The fund which manages $4.7 billion worth of properties that are leased by companies including Coles and Coca-Cola Amatil Limited
(ASX:CCL), has attracted solid demand from both existing and new investors. Canada’s Public Sector Pension Investment Board has reportedly invested more than $200 million. Some analysts predict the REIT will sell down a large part of its 43 per cent stake in the fund to focus on developments in the US, Europe and Asia. The company’s share price has soared more than 55 per cent so far this year.
AustralianSuper is planning to invest about $5 billion in real estate over the next five years. The industry fund’s which has 1.9 million members says it will target large top end shopping centres while continuing to build its portfolio in commercial properties.
