Investment Property Market Snapshot
Latest industry statistics and analysis.
Rents hold steady
Capital city asking rents for November fell 0.4 per cent to $548 p/w for houses, while units rose 0.2 per cent to $439 p/w, according to SQM Research. Houses: Canberra (+2.6 per cent to $594 p/w), Sydney (-1.1 to $730), Darwin (-0.9 to $536), Brisbane (-0.2 to $441), Adelaide (+0.1 to $377), Hobart (-2.9 to $375), Melbourne (+0.2 to $509) and Perth (+1 to $414). Units: Canberra (+1.6 to $428), Sydney (+0.3 to $522), Darwin (+0.4 to $399), Brisbane (+0.2 to $365), Adelaide (+0.4 to $290), Hobart (+7.9 to $334), Melbourne (-0.5 to $393) and Perth (+0.5 to $323).
Vacancy rates dip
The national vacancy rate was 2.1 per cent in October (down from 2.2 per cent in September), according to data released by SQM Research. Falls in vacancy rates were recorded for all capitals. Hobart continued to have the lowest vacancy rate at 0.3 per cent with just 75 properties available for lease in October, followed by Canberra (0.8 per cent), Adelaide (1.4), Melbourne (1.8), Sydney (1.9 per cent), Darwin (2.5), Brisbane (3) and Perth (4.1).
Days on market increases
Figures from rent.com.au found the number of days a rental was on the market in October was up month-on-month in all capitals except Adelaide (held steady at 24.8 days) for houses, and only Adelaide (-0.3 per cent to 25.8 days) and Hobart (-3.5 per cent to 11.5 days) recorded a drop in the number of days on the market for apartments.
Capital gains slow
Combined values were flat in October across both capital cities and regional areas, according to CoreLogic’s Home Value Index. Most of the regional areas experienced a slow-down in the rate of capital gains in the three months ending in October. Three capitals recorded negative value growth – Sydney (-0.6 per cent), Perth (-0.7 per cent) and Darwin (-4.4 per cent). Hobart recorded the strongest growth with values rising 0.9 per cent, followed by Melbourne at 0.5 per cent and Brisbane at 0.2 per cent. Adelaide was unchanged.
Tightened lending rules and higher interest rates have resulted in a decline in investor loans. ABS data for September revealed significant declines in both the number and value of loans compared to the previous month. The total value of housing finance commitments in September was $32.5 billion, down 3.6 per cent over the month. The value of investor loan commitments was down 6.2 per cent (seasonally adjusted) to $11.8 billion (down 3 per cent to $1 billion for construction of dwellings and down 6.4 per cent to $10.8 billion for purchase of established dwellings).
Analysis from CoreLogic also found the percentage of new mortgage demand from investors was down in most states and territories and significantly down on the five-year average rate: NSW at 50.3 per cent (five-year average of 55.6 per cent); Vic at 43.2 (46.9), Qld at 34.3 (40.8), SA at 36.9 (39.8), WA at 33.6 (38.1), NT at 34.1 (49.2) and ACT at 38.2 (43). Tasmania recorded a rise to 33.3 per cent, with the five-year average at 30.3 per cent.
Regional dwelling prices hold steady
Dwelling prices in regional areas held steady in the October quarter, according to CoreLogic’s Property Pulse. Across the nation, the regional markets fell 0.1 per cent: NSW (+0.7 per cent for the quarter), Victoria (-0.3), Queensland (-0.5), SA (-2.1), WA (-1.4), Tasmanian (+0.4), and the NT (+0.7).
A survey by Mortgage Choice has found 64.3 per cent of respondents believed the housing market would maintain its performance from the last few years, and even possibly improve. The survey found the majority of Australians were optimistic about investing in property and will continue to buy and sell dwellings.