Housing affordability across the nation
The gap between capital city property markets is widening as the Australian economy searches for new drivers of growth as the mining boom fades. The Sydney and Melbourne property markets are harder to enter even with signs that the property boom has peaked there. Other capital city markets such as Brisbane and Canberra are showing subdued growth and remain much more affordable for both owner-occupiers and investors.
Where does opportunity lie?
CoreLogic RP data has identified some golden geese of the Melbourne property market, suburbs that provide not only high rental yields but also attractive capital gains. There were 34 suburbs in the Victorian capital that recorded capital growth with yields in excess of the citywide outcome. The top five standout suburbs were Ferntree Gully, Brunswick West, Chelsea, Mount Martha and Boronia whilst the top five for houses were Bayswater, Altona North, Boronia, Collingwood and Mooroolbark.
A Bi-annual Housing Industry Association report says Western Australia is still topping the list as the country’s strongest home building market. WA remains far ahead of the Northern Territory and New South Wales with an even bigger gap to Victoria and South Australia. The ACT has tumbled from fourth to sixth with a drop in multi unit construction while the spotlight remains on QLD where a recovery is starting to gather momentum.
Also from the Housing Industry Association, the Stamp Duty Watch report, an insight into the stamp duty bill faced by homebuyers, has shown that whist first home buyers received grants and concessions on the stamp duty bills, in many cases the support is entirely cancelled out with the bills. First home buyers in NSW, Victoria and WA will use up their whole grant and more whilst in SA and the ACT first home buyers may only be left over with a few hundred dollars to go towards the cost of their new home.
Commentary
And a new report from the Adelaide Bank/Real Estate Institute of Australia has shown that the ACT continues its long run as the most affordable state or territory in which to rent or buy.
Amanda Lynch, CEO of Real Estate Institute of Australia says housing affordability is actually improving, just in time for Christmas.
The new report shows an improvement in housing affordability across Australia, the proportion of income required to make loan repayments decreasing slightly by half a percentage point. New South Wales is the least affordable state for home buyers so I’d recommend if you’re wanting to invest, to look at some of the other states like Queensland, Western Australia has lower house price growth due to the mining boom easing and South Australia and Tasmania also have some good bargains. The ACT market is actually softening quite a bit. It means that there are some good apartments, townhouses for sale and you are able to negotiate some quite good deals.
Australian auction results
Looking at this week’s auction results across Australian capital cities - Sydney recorded a 71 per cent clearance rate from 1028 properties for auction, Melbourne cleared 70 per cent from 1456 properties, Brisbane had a 33 per cent clearance rate from 140 properties listed and Adelaide cleared 66 per cent from 80 listed auctions.
Commercial property sector
Aveo Group Limited
(ASX:AOG) has settled two sales, receiving $20 million for 63 Miller St, North Sydney and $16.5 million for the Skyring Towers in Brisbane.
Qube Holdings Limited
(ASX:QUB) has reached an agreement with Moorebank intermodal Company to develop the Moorebank project in South Western Sydney.
Subject to due diligence and regulatory approval, Estia Health Limited
(ASX:EHE) has agreed to pay $13.5 million for 80 room aged care facility.
And just a day after it reported a recent acquisition of two sites in South East Queensland, Villa World Limited
(ASX:VLW) announced a $7.2 million site purchase at in the Lend Lease ‘Woodlands Estate’ at Waterford, Brisbane.
