PROPERTY -- Market Watch728 people have read this article
|
| Monday, 30 August 2010 |
|
The latest property and housing finance figures suggest the recent slump in property price growth may soon be over. By: Belinda Luc Despite another fall in housing finance in the month of June, low property growth in most capital cities and a low number of building approvals, a recovery of the property market is on the horizon, based on a broad analysis of the latest figures. In June, owner occupied finance fell 3.9 per cent from the month prior, according to the ABS. Building approvals were down in June by 3.3 per cent overall, according to the ABS, with private housing development hit the hardest. But these factors do not mean that property market growth will continue to slide in the months to come. In fact, there are a few positive signs that indicate that some areas will be on a steady growth path in the 12 months to come. Westpac senior economist Andrew Hanlan said the latest slump in price growth has been "expected" in the wake of the RBA's interest rate normalisation strategy and the recent dip in consumer confidence. Westpac's consumer sentiment index in August showed renewed consumer confidence, with a reading of 119.2 compared to 113.1 in July. Further, the RBA's decision to hold the cash rate since May, strong population growth and strong employment growth are sure to continue to boost consumer confidence and borrowing over the months to follow. While lending figures dropped off in the upgrade and investor sectors in June, overall there's been an aggregate increase over the past months, indicating a steady upswing. Investor numbers fell in June by 3.6 per cent, but since January 2009 lending to investors has actually risen by 29 per cent. And further gains can be expected in response to strong rental income growth, particularly in the unit sector. Units have continued to eclipse house growth by an average of 0.3 per cent over the last five years and gross rental yields have remained remain strong at 4.8 per cent (4.0 per cent for houses). MORTGAGE INDICATORS LENDING FOR HOUSING - SEASONALLY ADJUSTED AVERAGE NEW OWNER OCCUPIER HOME LOAN FIXED RATE LOANS AS PERCENTAGE OF OWNER OCCUPIER LOANS FIRST HOME BUYERS AS PERCENTAGE OF OWNER OCCUPIER FINANCE COMMITMENTS Source: ABS BUILDING APPROVALS TOTAL DWELLING UNITS APPROVED TOTAL PRIVATE SECTOR HOUSES APPROVED TOTAL PRIVATE SECTOR OTHER DWELLINGS APPROVED Source: ABS PROPERTY LATEST FIGURES BRISBANE Median unit price: $380,000 SYDNEY Median unit price: $445,000 CANBERRA Median unit price: $420,000 MELBOURNE Median unit price $425,000 ADELAIDE Median unit price: $340,000 PERTH Median unit price: $425,000 DARWIN Median unit price: $390,000 Source: RP Data - Based on repeat sales indices |
