It’s becoming a buyer’s market in Sydney and Melbourne as stock levels hit record highs in the lead up to Christmas. First home buyers and owner occupiers are taking advantage of reduced buying activity from Chinese and other foreign buyers as auction activity shows some moderation and prices level out. The auction market is seeing lower increment bids, the increased use of vendor bids and there are higher levels of unreported results as real estate agents work on post-auction deals to secure a sale. Volumes continue to rise ahead of the holiday season however with 1600 homes expected to go under the hammer in Melbourne next week which is an all-time record for the Melbourne market.
Real Estate figures
Property investors are falling by the wayside as tighter lending regulations impact on the costs and perks of their loans. Housing finance figures for September released by the ABS show an 8.5 per cent drop in lending to investors. This is the biggest drop in investment lending for 7 years. Lending to owner-occupiers rose by 3 per cent for the month. The total value of housing finance commitments dropped by 1.6 per cent over the month.
FNN spoke to John Flavell CEO of Mortgage Choice about what has caused such a big drop in investor finance.
"Investment lending has been running well above historical norm in the vicinity of 40 per cent or more of total lending up until July this year. We’ve seen a steady decline since then and our expectations at the moment is we will continue to see a decline in that proportion of lending going into that in the coming months on the back of the applications that we have taken. It’s not surprising. What drives investment lending is 3 things. Investor sentiment, access to credit and cost of credit and we’ve obviously seen a lot of press in recent times in relation to investment lending and it’s hardly surprising that against that backdrop people’s focus has now changed."
Australian auction results
Looking at this week’s auction results across Australian capital cities - Sydney recorded a 63 per cent clearance rate from 940 properties for auction, Canberra reported a clearance rate of 71 per cent from 84 properties for sale, Melbourne cleared 70 per cent from 1338 properties, Brisbane had a 42 per cent clearance rate from 159 properties listed and Adelaide cleared 45 per cent from 79 listed auctions.
Commercial property news
Mirvac Group (ASX:MGR)
says it has won a tender to acquire and redevelop the Australian Technology Park in Sydney for $263 million.
Westfield Group (ASX:WFD)
has sold is Carlsbad enclosed mall in California to rival Rouse Properties for $240 million.
Growthpoint Properties Australia Limited (ASX:GOZ)
has had its Baa2 credit rating confirmed by Moody’s Investor Service.
And Folkestone Education Trust (ASX:FET)
says it plans to develop a Seniors Living Platform to include retirement villages and aged care facilities.