Saturday, March 9, 2013

Not Back to Boom Time

"AMP Capital’s head of investment strategy, Shane Oliver, also predicts “a year or two” of house price gains but “not a lot”.  “It’s not back to boom time,” he says. “House prices are high relative to income, lending is constrained and borrowers are cautious.

“Everyone knows the story of housing in the US, the UK and Spain. I think Australians are well aware that prices can go down. That realisation was not there pre-GFC.”
The global crisis has changed the psyche in other ways. No longer is buying and renovating a home the No. 1 ambition.
“We are a long way from the time when the The Block was the most popular show on TV,” Oliver says.
Of course, if mortgage rates fall much further, all bets are off. If the cash rate drops to 2 per cent, as one lead strategist predicts, the lure of cheap money and rising property prices will be hard to resist.  But it is unlikely. Most analysts predict one or two more cuts to the cash rate and some competitive offers on mortgages."

See AFR - Preparing for lift-off

More Sales in Brisbane

RP Data Reports

Information from RP Data

Two bed sale in Charlotte Towers - a record!?

A real estate agent is promoting a recent sale in Charlotte Towers:

"RECORD SALE OF THE YEAR! Being the only two bed, two bath apartment available in Charlotte Towers. This one went fast! Selling in less than a week, the high demand and professional approach allowed for another Record sale of $530,500 in this ever popular building.."  See here.

I guess it is only 8 weeks into the year, so it is probably not hard to get a records sale for the year in that period.

REIQ Reports that apartment activity grew at end of 2012

Queensland units and townhouses have followed the positive lead of the house market, according to the latest Real Estate Institute of Queensland (REIQ) data.

The REIQ’s December Queensland Market Monitor (QMM), released today, showed the numbers of unit and townhouse sales across the State continued the property market’s upward trend compared to the year before.  The numbers of unit and townhouse sales increased 8.9 per cent in the December quarter 2012 compared to the same period in 2011.

REIQ CEO Anton Kardash said the driving force behind the improving sales volumes was the southeast corner.  “Compared to the December quarter in 2011, the numbers of sales in Brisbane and the Gold and Sunshine coasts continues to trend upwards, which of course partly reflects the concentration of, and demand for, these types of properties in South East Queensland,” he said.

“Also this quarter, there has been an increase in the numbers of affordable unit sales across the State, especially for properties priced between $250,000 and $350,000, as buyers take advantage of some attractively-priced properties.  And Brisbane has posted its second quarter where the annual median price change has been in the positive, which is another sign that prices are heading in the right direction once more.”

According to the QMM, the numbers of sales in Brisbane was up 16 per cent compared to the December quarter in 2011; sales on the Gold Coast were up 8 per cent; and on the Sunshine Coast, the sales numbers increased an impressive 23 per cent over the same periods.

“The median price of units and townhouses on the Sunshine Coast also increased 1.1 per cent to $328,500 over the quarter with Noosa Heads and Noosaville also both recording price growth,” Mr Kardash said.

The Brisbane median unit price decreased 4 per cent to $389,000 over the quarter but posted an increase of 0.3 per cent over the year ending December. Over the period there was also a marked rise in the numbers of sales between $250,000 and $350,000 which reduced the overall median price.

“Inner Brisbane suburbs continue to do well with median prices in New Farm and South Brisbane all posting solid price growth,” Mr Kardash said. 

Friday, March 8, 2013


"Australia’s housing recovery, which is seven months young, is solidifying. The question is how hard and long it will run. In January last year I wrote that if the Reserve Bank of Australia cut rates again, one could expect the rebound in this interest rate-sensitive sector to accelerate. ...

With banks dulling earlier policy easings, Australia’s housing market did not get any real relief until the RBA’s hefty 75 basis point cuts over May and June. The response was almost immediate: home values in most Australian cities began appreciating in June last year. Since then they have risen about 4 per cent across the five major capital cities, with better growth again in Sydney, Melbourne and Perth.  Additional cuts in October and December ensured that the cost of housing has accelerated more rapidly this year. Based on the latest data to March 7, Australian dwelling values have climbed more than 2 per cent already in 2013."

See Chris Joye in AFR:  Property Stuggles Back

Tuesday, March 5, 2013


Employment is a key factor impacting apartment prices.

"So what could trigger an overdue shift in rhetoric? Watch the jobless rate. Economists and the RBA forecast it will drift towards 6 per cent. While I think there is scope for it to soften in the near term, I suspect it could start falling again in 2013. This would be a game-changer. An unambiguous decline in the jobless rate, propelled by an ageing population that shrinks the pool of productive labour, will force the RBA to remove its extreme stimulus."  See AFR