RESIDENTIAL PROPERTY

House prices continue to strengthen

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BUYER activity is managing to meet record levels of listings in the housing market over the month, with prices still climbing, according to Archistar.

According to Archistar’s latest National Housing Market Report, all capitals reported strong house price growth over the first quarter reaching above 2017 peaks, with all five capitals reported on also seeing increases for the month.

In May, Sydney reported not only the greatest monthly increase, at 2.1%, but remained seated far above the other capitals’ median asking house asking prices, at $1,284,052.

Melbourne followed, with a median asking price of $869,599 and a monthly change of 1.3%.

Brisbane reported a median house asking price of $573,086, Adelaide with $550,690 and Perth with $563,173.

While Brisbane’s monthly increase was at 1.1%, Adelaide at 0.9% and Perth at 0.4%.

“The number of total newly listed homes for sale remained at high levels over May with sellers continuing to take advantage of ongoing strong buyer competition for property and continued upward pressure on house prices,” said Dr Andrew Wilson, chief economist for My Housing Market.

Melbourne saw the greatest fall in newly advertised home listings for the month, with a 17.1% decline, thanks to the city’s ongoing COVID-19 restrictions.

While Adelaide also saw a decline, of 3.9%, the other capitals reported increases, with Sydney outperforming at 3.8%, followed by Brisbane with 3% and Perth with 1.6%.

At 11,868, Melbourne had the highest average total daily stock on the market over may, followed by Perth with 10,569 listings, Brisbane with 10,226, Sydney with 7,999 and Adelaide with 3,650.

While Sydney had the highest average number units listed for sale daily, at 7,615, followed by Melbourne with 6,435, Brisbane with 3,219, Perth with 2,305 and finally Adelaide with 980.

Sydney had a monthly increase in houses advertised daily at 10.3%, followed by Perth at 6.8%, while Melbourne saw the biggest decline at 2.7%, followed by Adelaide with 2.5% and Brisbane with 1.1%.

Though Perth the biggest monthly increase in units advertised daily at 6.8%, followed by Sydney at 4.1%, Melbourne at 1.7%, Adelaide at 0.4%. Brisbane was the only capital to see a decrease, at 2.6%.

In newly reported home sales for May, Melbourne saw the greatest increase at 17.1%, followed by Adelaide with 14.5%, Sydney with 6.9%, Brisbane with 6.8% and Perth with 0.7%.

Meanwhile in rents, Sydney had the greatest median weekly asking rents for house and units, at $510 and $450 respectively.

While Melbourne reported houses at $428 and units at $370, Brisbane at $425 and $420, Adelaide at $436 and $379 and Perth at $450 and $407 respectively.

All capitals saw a yearly increase in asking rents, except for Melbourne and Sydney who saw significant decreases for both units and rents. With Sydney seeing a 5% decline for houses and 10% decline for units and Melbourne reporting a 4.9% decline for houses and 11.9% for units.

Melbourne and Sydney also had the highest rental vacancy rates for March, at 3.4% and 3.1% respectively, compared with Brisbane’s 1.4%, Adelaide’s 0.8% and Perth’s 1.1%.

“Despite record listings, auction clearance rates have remained generally strong for all capitals and clearly in favour of sellers – although having predictably eased from the remarkable all-time record results recorded over March,” said Wilson.

National auction capitals average Saturday clearance rates were at 77.9% on 12 June, gradually falling from the last high of 88.5% at 6 March.

Adelaide was the only capital to report a higher clearance rate in May over April at 86.9% compared to 85.1%. While Brisbane recorded the greatest decline from 83% to 71.7%.

All other capital’s rates falling though remaining relatively stable with Sydney slipping from 84.4% to 83.9%, Melbourne from 79.2% to 78.6% and Canberra with 92% to 91.3%.

“Auction listings and clearance rates will continue to moderate through the typically subdued winter selling season although underlying activity will remain strong,” said Wilson.

Median weekend auction prices grew the most in Brisbane at 16.7% to $1,120,000, while Sydney’s median price was the highest, climbing 5.7% to $1,620,000.

Melbourne increased by 8.2% to $1,050,000, Adelaide by 7% to $756,000 and Canberra by 5.6% to $945,000.

“Owner-occupiers continue to drive housing markets at record levels and although first home buyer activity remains well above long-term average levels, loan numbers from this group are clearly declining as a result of sharply higher prices and Increased crowding-out activity from investors,” said Wilson.

While first home buyer lending again declined to $6.69 billion, investor lending increased to $8.05 billion and owner occupier lending to $21.37 billion.

Western Australia saw the greatest yearly increase in home loans at 102.9%, Queensland followed with 74.3%, South Australia with 54.3%, Victoria with 43.4% and New South Wales with 43.1%.

The report forecasts that underlying activity will remain at record highs, with house prices continuing to increase, even as the market cools down over the winter months.

“The satisfaction of pent-up buyer demand will also act to moderate buyer activity although rising activity from Investors will keep markets bubbling along,” said Wilson.

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