Higher incomes and lower interest rates have contributed to making Australian houses the most affordable in three years. Housing affordability improved in the last three months of 2012, according to The Real Estate Institute of Australia’s (REIA) Housing Affordability Report. The institute’s president Peter Bushby says rising income and declining mortgage repayments contributed to the improvement, with the median family income increasing 2.2 per cent and the average monthly loan repayments decreasing 2.1 per cent.
Real Estate figures
Home loan approvals fell 1.5 per cent to 44,383 in January, according to the Australian Bureau of Statistics, the fourth consecutive monthly fall. Total housing finance by value rose 2.4 per cent to 21.48 billion in the month.
Australia's construction sector has improved to a 2.5 year high, though remains in contraction mode. The Australian Industry Group and Housing Industry Association performance of construction index gained 9.4 points to 45.6 in February, but remained below 50 which indicates contraction.
Commentary
FNN asks Macquarie Group Limited’s
(ASX:MQG) Global Head of Economics, Richard Gibbs, which Australian states are the best positioned to benefit from last year’s Reserve Bank cuts to the key cash rate:
“I think New South Wales is actually primed for some pick up, I mean obviously it’s been a laggard for some time. Victoria would also seem likely to trade through pretty well, particularly as the business services, financial wealth management and the like are all starting to grow again in those centres. I think Western Australia obviously is going to continue to benefit from- if not the resource movement then obviously the energy side of that economy as well. Queensland I think will struggle, obviously natural disasters hitting Queensland haven’t helped. So the majority of property activity is really on replacement rather than the construction of new inventory.”
To watch more of the interview click
here.
Australian auction results
This week’s auction results across Australian capital cities - Sydney recorded a 73 per cent clearance rate from 332 properties for auction, Melbourne cleared 61 per cent from 116 properties, Brisbane had a 44 per cent clearance rate from 23 properties listed and Adelaide cleared 59 per cent from 14 reported auctions.
Commercial property sector
Property developer Sunland Group Limited
(ASX:SDG) has advised it will undertake about $700 million in the Australian residential property market this year including plans to launch nine new developments.
Building products manufacturer CSR Limited
(ASX:CSR) will cut 150 jobs from its Viridian glass business as the impact from a high Australian dollar and low construction activity take their toll.
Property investor Centuria Capital Limited
(ASX:CNI) has appointed former Mirvac Group
(ASX:MGR) boss Nick Collishaw to head its listed funds division.
