Auction slowdown highlights cooling market

According to RP Data, the slowdown in auction activity is reflected in the stall of median price growth nationwide.

Median house prices inched slightly higher in the June quarter, with Brisbane and Darwin recording a mere 0.92 per cent and 0.77 per cent growth respectively.

While in Perth, median house prices fell by 2.33 per cent.

The story was similar for units, with Adelaide and Melbourne recording 0.51 per cent and 1.80 per cent median unit price growth respectively.

Some areas of the property market have been hit worse than others. Auction sales activity in the high end of the market has certainly dropped off, partly due to wealthy buyers having money tied up in the volatile stock market and being hit hard by the poor economic conditions in Europe.

According to RP Data research analyst Tim Lawless, these factors would certainly have reigned in the housing ambitions for potential prestige property owners.

But all these factors could signify that the market is transitioning towards a lower and more sustainable growth path, which is a positive sign.

More stabilised house price growth will result in better auction results, with purchasers being less likely to be confronted with overinflated reserve prices and unexpected bids.

The economy has reached more ‘normal' levels which gives hope that interest rates will stabilise over the next 12 months. Westpac is certainly predicting the RBA cash rate will increase gradually by 100 basis points to reach 5.5 per cent by September 2011, which is still lower than back in October 2008.

And these factors can only encourage buyer confidence.

PRICES AND INDICATORS

LATEST FIGURES

DARWIN
Median house price: $558,883
Quarterly growth: 0.77%
Annual growth: 13.03%
Average annual growth: 15.51%
Median weekly rent: $546
Gross rental yield: 5.08%

Median unit price: $436,280
Quarterly growth: 4.00%
Annual growth: 22.52%
Average annual growth: 16.75%
Median weekly rent: $457
Gross rental yield: 5.44%

BRISBANE
Median house price: $489,849
Quarterly growth: 0.92%
Annual growth: 6.53%
Average annual growth: 10.07%
Median weekly rent: $363
Gross rental yield: 3.86%

Median unit price: $361,257
Quarterly growth: 0.45%
Annual growth: 6.32%
Average annual growth: 10.12%
Median weekly rent: $324
Gross rental yield: 4.67%

SYDNEY
Median house price: $653,184
Quarterly growth: 2.31%
Annual growth: 10.78%
Average annual growth: 3.39%
Median weekly rent: $504
Gross rental yield: 4.01%

Median unit price: $496,548
Quarterly growth: 2.44%
Annual growth: 10.56%
Average annual growth: 3.74%
Median weekly rent: $478
Gross rental yield: 5.00%

CANBERRA
Median house price: $571,574
Quarterly growth: 3.60%
Annual growth: 15.60%
Average annual growth: 8.23%
Median weekly rent: $487
Gross rental yield: 4.43%

Median unit price: $446,742
Quarterly growth: 4.27%
Annual growth: 13.75%
Average annual growth: 10.32%
Median weekly rent: $441
Gross rental yield: 5.13%

MELBOURNE
Median house price: $565,911
Quarterly growth: 3.71%
Annual growth: 17.10%
Average annual growth: 7.85%
Median weekly rent: $374
Gross rental yield: 3.44%

Median unit price $448,031
Quarterly growth: 1.80%
Annual growth: 15.49%
Average annual growth: 7.38%
Median weekly rent: $351
Gross rental yield: 4.08%

ADELAIDE
Median house price: $$459,693
Quarterly growth: 2.76%
Annual growth: 10.72%
Average annual growth: 8.17%
Median weekly rent: $344
Gross rental yield: 3.89%

Median unit price: $374,156
Quarterly growth: 0.51%
Annual growth: 7.19%
Average annual growth: 10.30%
Median weekly rent: $317
Gross rental yield: 4.41%

PERTH
Median house price: $519,043
Quarterly growth: -2.33%
Annual growth: 5.93%
Average annual growth: 10.92%
Median weekly rent: $399
Gross rental yield: 4.00%

Median unit price: $503,504
Quarterly growth: -1.02%
Annual growth: 5.89%
Average annual growth: 12.41%
Median weekly rent: $398
Gross rental yield: 4.11%

MORTGAGE INDICATORS

LENDING FOR HOUSING - SEASONALLY ADJUSTED
May 10: $13.698 billion
Change from April 10:Decreased by 0.3%
Change from May 09:Decreased by 20.3%

AVERAGE NEW OWNER OCCUPIER HOME LOAN
May 10: $283,100
Change from April 10: Decreased by 1.3%
Change from May 09: Increased by 6.3%

FIXED RATE LOANS AS PERCENTAGE OF OWNER OCCUPIER LOANS
May 10: 3.7%
Change from April 10: Increased by 1.3%
Change from May 09: Decreased by 2.5%

FIRST HOME BUYERS AS PERCENTAGE OF OWNER OCCUPIER FINANCE COMMITMENTS
May 10: 16.1%
Change from April 10: Decreased by 0.2%
Change from May 09: Decreased by 12.4%

BUILDING APPROVALS

TOTAL DWELLING UNITS APPROVED
May 10: 13,412
Change from April 10: Decreased by 6.6%
Change from May 09: Increased by 26.6%

TOTAL PRIVATE SECTOR HOUSES APPROVED
May 10: 8,835
Change from April 10: Increased by 1.7%
Change from May 09: Increased by 9.2%

TOTAL PRIVATE SECTOR OTHER DWELLINGS APPROVED
May 10: 3,643
Change from April 10: Decreased by 18.8%
Change from May 09: Increased by 86.1%