THE dream of home ownership is slipping further out of reach of ordinary Australians as the nation faces its worst-ever housing shortage.  A national shortfall of 190,000 dwellings will widen to 466,000 by 2020, the Housing Industry Association (HIA) says, amid expectations of a rapidly growing population.

 

Residential developer Australand Property Group says the major constraint facing developers is a shortage of land being made available for greenfield sites and for urban infill.

 

"Generally it comes from a government level, how much land is being made available to fulfil those needs, whether it be at greenfields sites or urban infill."

 

HIA chief economist Harvey Dale says it takes an average seven to eight years for a greenfield site to reach completion, an unnecessarily long period that pushes up costs and reduces supply.

 

"At the end of the day, the lack of adequate, affordable land supply is at the heart of the problem," Dr Dale said.

 

"The number of processes a development must go through is higher now than was the case 10 years ago.

 

Developer Stockland says government inconsistency at all levels is adding thousands of dollars to the cost of new homes.

 

"We have 565 local government areas across our country, and as property developers we have almost 565 different planning standards, charges and processes to adhere to," Stockland residential chief executive Mark Hunter said.

 

Australand's Bob Johnston says the underlying demand for homes is quite strong and the company views that as an opportunity.

 

"We will see a lot of pressure come back on to affordability and we think we are well positioned to try and address those affordability issues for purchasers, whether it be through built form or the land subdivisions we do."

 

Mirvac says its development division expects strong demand to continue throughout 2010, signalling that investors and upgraders have returned to the market.

 

Investors had begun to edge out owner-occupiers, particularly first home buyers, figures released by Australian Property Monitors on Thursday show.

 

However, Dr Dale says Australians won't give up their dream of a detached home any time soon.

 

"In the here and now, consumer preference is still for a detached house. Although home and land sizes have fallen over the past 10 years."

 

Source:  AAP – 1 August 2010

AUSTRALIA is in a two-speed property market with strong demand in Melbourne and Sydney and uncertainty everywhere else, real estate group Ray White says.

 

Ray White joint chairman Brian White said the group's results for July reflected the uneven forces at work in real estate markets as the nation heads to a federal election.

Ray White said sales for July were down three per cent on the corresponding period in 2009.

"The continuing attraction for property in Melbourne and Sydney now defines what 2010 has been all about," Mr White said.

"Demand in those cities just doesn't seem to falter even though the top end properties are quieter and there is evidence of tighter bank lending requirements."

Victoria was the strongest performing state for Ray White, with sales more than 30 per cent up in July compared with the same month last year, while New South Wales reported a four per cent increase.

 

 Mr White said the major mining states of Western Australia and Queensland experienced a big drop off in sales.

 source:  AAP 13 August 2010

HOUSE prices in major capital cities have jumped by almost 20 per cent in the past year, according to the latest Australian Bureau of Statistics figures.

Houses in major capital cities have increased by 18.4% in the last year, says the ABS / File Source: Bloomberg

• City house prices up 18.4 per cent - ABS
• Figures more than double private data
• Price momentum 'slowing', says economist 

The House Price Index of eight capital cities released by the national statistician today, shows quarterly growth to June of 3.1%, and an annual increase of 18.4%.

The data shows growth of almost double that of the private sector RP Data/Rismark index released last week which showed national city dwelling values up 10.5% in the same period. 

In its data today, the ABS said Melbourne house prices had jumped more than 24 per cent over the year to June, while Sydney house prices had risen 21%.

The index covers detached residential dwellings on their own block of land regardless of age, the ABS said. The RP Data index is calculated measuring all dwelling types.

The RBA decided yesterday to leave interest rates on hold for a third straight month at 4.5%.

In its statement yesterday, the central bank noted “the upward pressure on dwelling prices appears to have abated”.

Mr Hassan said the ABS data did show a "clear slowing" in price momentum.

In a note released today ANZ economists said while growth was expected to slow further this year, prices would be supported by the underlying housing shortage and a buoyant outlook for the Australian economy.

Last week's RP Data index showed average house prices had fallen slightly after 17 months of consecutive gains, as economists agreed the market was at a turning point.

 

Source:  news.com.au  4 August 2010

PROPERTY investors are targeting off-the-plan apartments hoping for short-term capital gain, with thousands of prospective pre-sale buyers eyeing Sydney projects.

 

Ray White is reporting a 6 per cent lift in investor buying as shares weaken and with the end last year of the boosted first-home buyer's grant, The Australian reported.

 

An Australian Housing and Urban Research Institute report this month said 80 per cent of investors buy for long-term gain, but at least half sell within five years because of cashflow problems or disappointing capital growth. One in four investors sells within 12 months.

 

Developers in Sydney are reporting strong demand for new residential projects following stamp duty concession by the NSW government this year.

 

Tim Casey of St Hilliers Group says his company has had 650 people interested in apartments at the Caritas site in inner Sydney's Forbes Street, for which marketing begins this week.

 

And Harry Triguboff's Meriton Apartments reports strong interest for proposed apartments at the former Seven Network site at Epping, with more than 300 applications.

"In the next decade, we might see very little growth, and if investors keep buying and thinking 'I'm going to make a killing and then move on', they're going to find themselves a little disappointed," he said.

 

This would be mostly the case in Melbourne, where the market had been strong, he said. In Perth, Brisbane and Adelaide, the trend had already started to occur.

 

Source:  The Australian 24-8-10

RISING interest rates and weaker first home buyer activity will lead to slower house price growth in 2010, an economic forecaster says. House prices will not fall though, and rents are tipped to continue to rise because of a lack of supply, BIS Shrapnel says in its Residential Property Prospects, 2010 to 2013 report.

 

BIS senior project manager Angie Zigomanis said first home buyer activity has dropped after the expiry of the first home owner's grant boost at the end of 2009.

 

Affordability has also suffered as interest rates rise off their low levels, he says.

"With interest rates quickly lifting from these emergency levels, and the current variable rate of 7.4 per cent now being close to long term trends, the recent levels of price growth cannot be maintained," Mr Zigomanis said.

 

Investors will replace some of the demand lost as a result of those factors, meaning house prices will continue to grow, BIS says.

 

More moderate interest rate movements than recent months will also aid purchaser confidence, it says.

 

BIS forecasts the cash rate to rise by 50 basis points in the 2010/11 financial year and by another 50 basis points in 2011/12.

 

"The more stable interest rate environment is expected to underpin purchaser confidence as economic conditions continue to strengthen, and should continue to push through moderate house prices rises," Mr Zigomanis said.

 

House price growth is likely to remain at an average in the mid-single digit percentage range over the next three years, he says.

 

On a capital city basis, Sydney and Perth are expected to post the strongest growth in house prices in the coming years.

 

Weaker demand and local economic conditions are expected to lead to more moderate price growth in Brisbane, Hobart and Canberra.

 

Melbourne and Darwin have already experienced very strong price rises and low affordability will limit further rises, BIS says.

 

For renters, the shortage of dwellings will keep pressure on rents.

 

"Even though overseas migration inflows are steadily easing, a deficiency of stock is still in place with dwelling construction below underlying demand," Mr Zigomanis said.

 

Source:  AAP  Drew Cratchley  15 June 2010

The Reserve Bank has left Interest Rates unchanged during its June 2010 meeting today.

The cash rate remains stable at 4.5%

The Reserve Bank sees rates remaining stable for a few months until it assesses the global economy and where it will be headed.

The Reserve bank has a dilema with a very strong Australian economy, yet great uncertainty with Europe's economy and where it may head to in the coming months.

World growth is expected to slow, the reserve bank remains positive on Asia.

THE housing and construction industries are to receive a significant boost from the budget.

One of the measures taken by the government to increase housing supply is cutting to zero stamp duty for those buying dwellings off the plan.

Those aged over 65 years will pay no stamp duty on a new dwelling, as long as they live in it for more than 12 months. In both cases, the new dwelling must cost less than $600,000.

These will give the housing construction industry a substantial lift.

To qualify for zero stamp duty, new dwellings most be at the "pre-construction stage" – that is, before the laying of foundations has begun, although site preparation such as demolishing existing buildings is permitted.

For off-the-plan dwellings where building is under way, stamp duty will fall by 25 per cent.

The purpose is to get a lot more housing stock into the market.

Since the global financial crisis, property developers have found it difficult to obtain the financing for new developments. A higher level of pre-sale is expected to ease financing pressures, helping developers to get projects off the ground.

Treasury expects the additional measures to boost housing stock by 8000 properties, twice the estimate arrived at by BIS Shrapnel based on concessional cuts to stamp duty introduced earlier in Victoria.

These cuts are initially for 2 years and will then be reviewed

 

Source: ninemsn 9 June 2010

There are plenty of positives in the current market

by Terry Ryder. 

Introduction:
There are plenty of positives in the current market 

When property prices rise, most Australian families  benefit. This needs to be remembered, because media tends to forget.

Because of media's obsession with finding the  negatives in any set of circumstances, the rise in house prices is being  presented is a pessimistic way. Headlines such as The Great Australian Dream is Dead are now common. There are  frequent articles about a price bubble. Misinformation rules.

Here's how I see it. Seven out of ten households own  their homes. A rise in values is a good thing for them. Of the remaining 30%,  many are renters by choice, for various reasons. Those who rent but aspire to  home ownership are relatively few. For them, rising prices is bad news.

But the notion that home ownership is out of reach is  far from true. Affordability currently sits as "normal" levels. It's where it  has been for most of the past five years. House prices as a multiple of incomes  currently sit in line with long-term averages.

There is nothing unusual or concerning about the  recent rise in house prices. The overall rise in the past year, somewhere  around 11% or 12% according to most measures, is a solid year but not an  extraordinary one. Many years in the past decade have shown larger rises.

For many of our key cities, the recent rise in prices  is overdue. Sydney is now showing growth for the first time since 2004. Perth  is showing signs of recovery after three years of price decline. Both Brisbane  and Adelaide were under-performers in 2009. Melbourne had big growth in 2009,  but it was the first major spike in Melbourne values in six years, and long  overdue.  

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·         Falls on the global equities markets may provide a boost to the local residential property market, analysts say.

 

·         Melbourne-based buyers advocate Christopher Koren said investors typically turn to real estate in the aftermath of a stock market correction, as they did following the 1987 stock crash.

 

·         In Australia, a chronic shortage of new homes, as well as optimistic forecasts for the economy have helped push capital city house prices up by 20 per cent in the year to March, according to the Australian Bureau of Statistics.

 

·         Auction clearance rates have been falling over the past few weeks, from the highs of last year, but are still relatively strong

 

·         Sydney-based Adviser Edge head of property Louis Christopher said over the past 20 years, there is evidence of investors switching into property in times of heightened global risk, such as the aftermath of the 1987 stock crash.

·         Reserve Bank raises rates today by 0.25%

 

·         Cash rate is now 4.5%

 

·         Due to an increase in price inflation and house prices

 

·         Australia was on of the first countries to start raising rates as the global economy steadied last year – showing our strong resilient economy.

 

·         Many economists believe the Reserve bank will now pause for a couple of months and leave rates where they are for the time being.

 

·         A strengthening domestic economy with lower unemployment, rising prices are evident now in Australia.

 

·         Asia has also continued to show strong signs of growth

  Reserve bank mentions there is considerable buoyancy in the property market with prices continuing to increase over recent months

·         THE average Sydney house renter is paying about $110 more a week than they were five years ago.

Houses

·         In 2005 median rental rate across the Sydney $340 a week

·         Now about 2/3 is $450 a week.

Apartments

·         Apartment rents across Sydney have increased 52% in the last 5 years.

·         Average Sydney apartment rent is now $410 per week.

·         5 Years ago it was only $270 per week

 

·         Large Increases due to low number of investors and high number of owner occupiers in the past few years

·         Other factors – low supply of residential property in general – high demand from locals and overseas migrants – pushes Rents up

·         Rents will continue to increase throughout 2010.

·         Rents have increased 3.5% over the past 3 months alone !!

 

Source: RP Data – Tim Lawless – Research Director 18 April 2010

·         Australia has been voted the world's best country to bring up children by expatriate parents working here   (source: HSBC bank survey)

 

·         Australia provided the best environment for healthy and active children 

 

·         Expat children in Australia found it easier to make friends easier.While schools in the United States and Britain were the least child-friendly for foreigners, the study found.

 

·         delayedAds.push(function(){ FD.addExternalReferralsAd($merge(FD.baseAd, { id: "adspot-300x250-pos-3", iframeId: "adspot-300x250-pos-3-iframe", params: $merge($merge(FD.baseAd.params, { pos: 3, aamsz : "300x250" }),getAdParams("300x250")) ,addSmall: true ,smallText: "Advertisement: Story continues below" }) ); } ); The survey looked at more than 3100 expatriates from 50 countries, including

Hong Kong, Singapore, the United Kingdom, the United States, United Arab Emirates and Australia.

 

·         Australia had the largest proportion of expat parents who reported an improvement in the quality of family life compared with their original homes, while almost half (45 percent) said moving to the UK could have a negative effect.

 

·         Other Rankings       2^nd Singapore,       3^rd Hong Kong     4^th UAE,      5^th United States,  6th Britain.

 

·         Parents saw Britain and the US as generally less healthy places to live, with children in both countries more likely to spend more time watching TV and playing computer games.

·          

·         Overall, expat parents believed their children benefited by moving to a foreign country, with an average 48 percent of expat kids adapting well to a new culture, half making new friends easily and 49 percent adapting well to new schooling.

 

 

Source:  Sydney Morning Herald 12 March 2010

*  Australia's economic recovery will continue as China reported a near 12% growth rate in the first 3 months of 2010.

 

*  "There's a massive rebound in these Asian economies, so it very good news for Australia," Nomura Australia chief economist Stephen Roberts told AAP.

  

*  Adding to the positive result was a low inflation outcome, dampening fears that China's central bank would be forced to curb growth through an imminent interest rate rise to keep prices in check.

 

*  "A solid pace of growth clearly benefits a raft of Australian companies, particular in mining, construction, transport and engineering sectors," he said.

Australia’s actual rate of annual inflation, was just 2.1% in the December quarter – well between the Reserve Bank’s target range of 2-3%

 

*  The central bank's most recent forecast for CPI inflation in February was for a peak of 3.0 per cent by the June quarter this year, before moderating to 2.5 per cent by the end of the year and through to mid-2011.

The March quarter CPI is released by the Australian Bureau of Statistics on April 28.

 

 

Source:  ninemsn  15-4-10

*           Australia has strong population growth

 

*           This will continue to outstrip housing supply

 

*           Shortfall could reach 500,000 by 2029

 

*           Gap between demand and supply will continue to increase

 

*           The housing shortage is most critical in NSW, which accounts for almost one third of the nation's total population.

 

*           Population growth is at an all-time high

 

*           Australia is building fewer houses per head of population growth than at any time on record, according to new research from economist Saul Eslake.

 

*           Last year there were just 333 dwellings completed for every 1000 increase in population,  

 

*           Bureau of Statistics confirmed that Australia's population grew 2.1 per cent last year, almost double the world average of 1.1 per cent.

 

*           Population set to hit 34 million by 2050

 

 source: The Australian - 29 March 2010

 

*  Australia faces a housing affordability ''time bomb'' - primed by a dysfunctional planning system, a chronic undersupply of homes, and unrealistic expectations from buyers, accoring to the chief of one of the nation's largest homebuilders.

 

*  Australia has a current housing shortage of 200,000 homes (Stockland Managing Director – Matthew Quinn)

 

*  Australia is Short 60,000 new dwellings per year (Stockland Managing Director – Matthew Quinn)

 

*  This shortfall will only continue to increase unless more housing is constructed.

 

*  House prices increased by 13.6% in Australia in 2009

 

*  In the last decade they increased by 170% (Australian Bureau of Statistics)

 

*  Residential real estate prices have soared as Australia's economy nears notching up two decades of growth without a pause.

 

*  During the same period, Australia has had more immigrants, adding to housing demand.

 

 

(source:  Sydney Morning Herald – 16 March 2010)

 

*           Australia is facing an under-supply of housing that isn't meeting the demands of a growing population     and will push property prices even higher,                                  source: Reserve Bank of Australia.

 

*           If this does not occur – house prices and rents will continue to rise

 

*           Property prices increased by more than 10% in 2009 and this will continue in the future despite rising       interest rates

 

*           Unlike other countries rocked by the global financial crisis – Australia did not have an oversupply of         housing

 

*           The rate of increase in dwellings has been below the average of the past 50 years, while population has   increased at its fastest pace over the same period.

 

*           Business investment in Australia was around 16% of gross national product, close to a 40 year peak,       and was expected to rise over the next two years.  (Source:   Dr Lowe – Reserve Bank Australia)

 

 

 

Source nine news 10 March 2010

Sydney's median house price is almost $600,000 - almost double what it was 10- years ago.

 

But wherever you look, the story seems to be the same: stock is low and prices are going up. ''It's … definitely up at the moment,'' Jeff Torr, an agent at Century 21 Engadine, said. ''There's just no supply of properties.''

 

Sydney's median house price is $595,745, according to the Australian Property Monitors.

 

The days of buying a house in the east for $600,000 are gone, same for the northern beaches.

 

You will only be able to buy apartments in these areas for $600,000.

 

 

 

 

Source: Sydney Morning Herald -  4 March 2010

The federal government has kept the Australian economy growing strongly while the rest of the world has been devastated by the global downturn, Prime Minister Kevin Rudd says.

 

The national accounts released on Wednesday - a snapshot of the economy in the three months to the end of December - showed economic growth of 0.9% and the fastest pace in nearly two years.

 

 "This morning's national accounts confirmed once again that we have kept the Australian economy growing strongly, while other economies around the world remain devastated by the global recession," Mr Rudd said at the National Press Club where he was launching his new hospitals plan.

 

The quarterly increase was in line with economists' expectations, although the annual rate beat forecasts of 2.4% growth due to revisions to previous quarters.

"These national accounts represent a very solid outcome for the economy, for an economy which is the envy of the developed world," Treasurer Wayne Swan told reporters in Canberra.

 

"To have grown the economy in what has been one of the toughest years since the 1930s is a truly remarkable feat and the stimulus is providing a firm foundation for the economy."

 

"The economy has proven remarkably resilient, with the strong outcomes to date providing a solid base for a broadening recovery over the coming year."

JP Morgan chief economist Stephen Walters said the economy's impressive performance was despite the Reserve Bank of Australia (RBA) lifting interest rates three times during the December quarter.

 

"The economy's robust rate of expansion last quarter, which far exceeded official expectations when the emergency interest rate settings were put in place, explains why the RBA was the first G20 central bank to tighten monetary policy," Mr Walters said.

 

The RBA raised the cash rate on Tuesday to 4.0%

.

The Australian economy is operating very well, but unexpected growth in gross domestic product (GDP) should signal a winding back of government spending, shadow treasurer Joe Hockey says.

 

"The Australian economy is performing very well, but we can't look in the rearview mirror, we need to look forward," he said.

 

"And if the Rudd government continues to spend like drunken sailors at the pub, Australia will pay a very heavy price."

 

Source: nine news 3/03/2010

The Australian economy is facing a dramatic improvement in its growth prospects, back on par with that seen in 2007 at the height of the resources boom, according to a leading index.

 

The Westpac-Melbourne Institute leading index of economic activity, which indicates the likely pace of activity three to nine months into the future, posted an annualised growth rate of 6.2% in December.

 

The result, released on Wednesday, was well above the long term trend growth rate of 2.7%.

 

The annualised growth rate of the coincident index, which shows the current pace of economic activity, was 1.3%, but below its long-term trend of 3%.

 

Westpac senior economist Matthew Hassan said the annualised growth rate as measured by the leading index continues to rebound after dropping to minus 6.9% in May 2009 to the plus 6.2% in December.

 

Australia's economy grew by 0.5% in the year to September 2009, official data showed.

 

"This large swing is not only the fastest reversal since the economy bounced out of recession in the mid 1970s but also puts the growth outlook back on a par with that seen in 2007 at the height of Australia's resources boom," Mr Hassan said in a statement.

 

The turnaround had been broadly based with all but one component of the index improving, Mr Hassan said.

 

"Three of the four monthly components of the index rose in December the share price Index (up by 3.6 per cent); dwelling approvals (up by 2.2%) and US industrial production (up by 0.6%)," Mr Hassan said.

 

"One monthly component - the real money supply - fell by 0.9%."

Mr Hassan said a run of strong data released since the Reserve Bank of Australia's (RBA) board meeting on February 2 could edge the central bank to lift the overnight cash rate at its next board meeting on March 2.

 

The RBA surprised financial markets earlier this month by leaving the cash rate unchanged at 3.75%.

Most market economists had expected a 25 basis point rise to 4.0%.

 

"Data releases since the February meeting, including another surprisingly strong jobs report last week and today's Leading Index result, continue to show a faster than expected upturn in growth domestically," Mr Hassan said.

 

"The (Reserve) Bank has shifted to a slower pace of tightening and is now keeping its options more open.

 

"Decisions are likely to remain finely balanced but our central case is still for another 25 basis point rise in March," Mr Hassan said.

 

Source:  nine news:  17/02/2010

The brief respite for renters appears to be ending, Chris Vedelago reports.  With the economy on the mend and the property market back on the boil, life is about to get harder for Melbourne renters.

Why? Because, as strange as it sounds, the global financial crisis actually tempered some of the worst effects of what had been considered a deepening rental crisis in 2007-08.

Far too few houses and apartments were being built to meet the needs of Melbourne's rapidly swelling population.

In turn, strong property price growth and rising interest rates meant a growing number of renters could not afford to become home owners.

The result? Demand for rental housing soared, Melbourne's rental vacancy rate hit rock bottom and, ultimately, rents skyrocketed.

Back then, the market was awash in grim stories of families priced further and further out of the city; of every property, regardless of quality, attracting scores of applications; of inspection lines that ran out the door; and "rental auctions" where would-be tenants competed to pay rents well above market value.

Australian Property Monitors, which is owned by Fairfax, reports that Melbourne's median weekly rent rose in 2007 by a record-setting 15.8% for houses and 16 per cent for units.

In 2008, rising interest rates (with costs passed on to renters by landlords) and pent-up demand pushed rents up a further 9.1% for houses and 10.3% for units.

By comparison, rental growth hadn't topped 3.6% for houses or 4.3% for units from 2005-06, even flattening out and falling during the minor downturn of 2004.

In real money, the 2007-08 growth spurt saw an increase in weekly rents from $285 to $360 for houses and from $250 to $320 for units.

Meanwhile, the metropolitan rental vacancy rate dipped to as low as 0.9% but never rose above 1.6%  in any month during that two-year period.

The Real Estate Institute of Victoria believes that a vacancy rate of about 3% is "optimal": tight enough to ensure profitability for landlords but flexible and affordable enough to give tenants some choice - a level that hasn't been seen in five years.

No wonder there was so much talk about a rental crisis.

While the REIV says the metropolitan vacancy rate rose to 1.6 per cent in December — the highest it has been in three years — Melbourne's near record population growth and ongoing shortfall in new housing supply are expected to see it tighten once again.

APM is forecasting median rents will rise to $380 for houses (5.6%) and $360 (7.5%) for units this year, the strongest growth rate seen apart from 2007-08.

Mr Papaleo agrees. He says: "[Renters] had a bit of a breather in 2009. I don't see rents running away to double-digit growth in 2010; it'll be a much more modest increase.

"But it's not as if they have got much of an alternative now. With interest rates going up, the first home buyer grant essentially wound back and property prices at an even higher base than before, all these factors will discourage renters from going into home ownership."

 
 Source: Sydney Morning Herald 25 January 2010

House prices are at all time highs in most capitals after more buying in expensive suburbs drove the strongest annual price growth in seven years.  The medium-to-long-term outlook for property prices remains strong as the population grows, incomes rise and demand for houses outstrips new supply, says an Australian Property Monitors' report.  Despite a sluggish start, 2009 ended with the biggest price growth since 2003 on a rise in activity at the top end of the market, the APM December quarterly report released on Thursday says. Median national house prices for 2009 rose by to 12.1%.

 

Melbourne's prices jumped 18.5% for the year, past the $500,000 mark for the first time.

 

Sydney's median house prices rose 12.1% over the year, while Perth's annual growth was 8.7%to back over $500,000, a level not seen since March 2008, APM said.

Within Sydney the greatest increases were in City and Eastern Suburbs - 21.4%

then Lower North Shore 21.6%,

 

Hobart was the second strongest market nationally with median house prices rising over 14% in 2009 while prices in Darwin lifted 13.5% and Brisbane's 7.7%.

 

Adelaide remains the most affordable capital after posting the slowest median annual growth for houses at 2.4%.

 

First-home buyers sustained the market in the early part of the year, but "up-graders" and investors ultimately drove the market, AMP says.

 

Activity in more expensive suburbs benefited from the resilient jobs market in late 2009 and the rising share market.

 

"The price growth seen in the more expensive suburbs in 2009 has largely been a recovery of the price falls that have occurred since late 2007 and early 2008," APM economist Matthew Bell said.

 

"This top-end recovery has been completed in most capitals with median house prices surpassing pre-global financial crisis highs for the first time in the December quarter in Sydney, Brisbane, Adelaide and Perth."

 

Mr Bell said rising interest rates and the expiry of the first home-owner boost at the end of December would slow activity for first-home buyers.

 

Median unit prices in capitals did not follow the housing trend over 2009.

Darwin units were up 22.8 per cent over 2009, Perth was next with 15.8 per cent growth then Hobart with 14.6 per cent.

 

 

Source:  ninemsn & Sydney Morning Herald -  28 January 2010

The property scramble is on.  Supply, or rather, a serious lack of it, is tipped to become one of the driving forces shaping the 2010 residential market.

 

There may be very little auction activity going on now but industry reports of strong levels of buyer inquiry and open-for-inspection numbers are already being received from across the metropolitan area.

 

It's not surprising, really, when you consider how 2009 ended. With a clearance rate above 80 per cent for December — the strongest it has ever been — a lot of prospective buyers who failed to get a property last year are still circulating in the market.

 

"They lost out last year, sometimes more than once, and they're keenly aware that they'll face more new competition this year and further price rises," said Catherine Cashmore of JPP Buyer Advocates.

 

"They don't disappear; they're still looking. Even average properties are attracting plenty of interest because there isn't enough available to meet demand."

RP Data reports that the number of properties advertised for sale in Melbourne in the month to January 10 was 30 per cent lower than for the same period in 2009.

 

About 1000 fewer properties came on the market each week in 2009 than in 2008, creating a supply drought at the same time that buyers began to surge back into the market because of government hand-outs, low interest rates and renewed confidence in the economy.

 

"We had a situation where there were more buyers out there looking for property but fewer properties being added to the market," said RP Data analyst Cameron Kusher.

"The low amount of stock available for sale and continued relative buoyancy of the residential property market should see real estate conditions continue to remain quite healthy."

 

That's great news for vendors but it means buyers can expect a tough time of it, likely to be forced to pay higher prices, assuming they are actually able to find a property.

REIV said 16 auctions were held around Victoria yesterday, the bulk of them in coastal and holiday areas.

 

There are more than 40 auctions scheduled for next weekend. The REIV median house and apartment price data for the December quarter will be released on Saturday.

 

Author: Chris Vedelago
Date: January 18, 2010

Sydney Morning Herald

Sydney tenants have been warned to brace themselves for a return to steeply rising rents as economists predict the sluggish rental growth of 2009 will end.  New figures from Australian Property Monitors, which is owned by Fairfax, show rental prices remained steady in the December quarter, with house and apartment rents in Sydney rising by only 2.2 per cent and 2.4 per cent respectively.

But an economist for APM, Matthew Bell, said a healthier economy, rising interest rates and land tax increases would all cause rents to increase at a higher rate in the coming year.

 

"It is clear that in 2009 rents were generally kept in a holding pattern as landlords and the market waited to see the end of the global financial crisis," he said.

 

"Sydney rents are likely to increase by at least double the 2009 rate of 2.2 per cent to approach the $500 per week level for houses."

 

A Macquarie Group economist, Brian Redican, said incentives for first-home buyers in 2009 also would have lured many people out of the rental market, which would have lessened demand.

 

"That pressure valve won't be there in 2010," he said. The slow growth in the December quarter was markedly down on the 2007 and 2008 figures, when rents rose by an average of 12 per cent each year.

 

During that period, the Herald reported real estate agents were having to extend normal inspection times to cope with large numbers of prospective renters.

 

But despite the flatter market last year, agents said interest from tenants had remained high. "I don't know that it eased that much last year ... there was still very high demand for property and quite low supply," Tim McKibbin, chief executive of the Real Estate Institute of NSW, said.

 

The drop off in rental growth was driven by the western, inner-west, south-western and upper north shore regions of Sydney, according to APM.

 

But rents did rise in the December quarter for houses in the eastern suburbs and lower north shore, regions with some of the city's most expensive rents.

 

Aaron Gadiel, chief executive of the Urban Taskforce, a lobby group representing property developers, said the dwindling supply of housing in Sydney would also continue to drive up rents.

 

"We're currently seeing the lowest levels of approvals for apartments, terraces and townhouses since 1987," he said.

 

But Mr Redican said an influx of new housing stock in the later part of 2010 should provide some relief and help stem price increases.

 

The Tenants Union of NSW said renters should be wary of predictions of rental increases especially from groups with a stake in the property industry.

 

Steep increases had been predicted in 2009 but had never eventuated, the policy officer, Chris Martin, said. Sydney's average rental vacancy rate rose to a two-year high of 1.6 per cent in November 2009, according to the most recent figures from the institute.

 

The most recent data available from the Department of Housing, for the September 2009 quarter, showed rents for a two-bedroom flat increased from between 2.8 per cent to 6.5 per cent.

 

Author: Josephine Tovey
Date: January 13, 2010
Publication:  Sydney Morning Herald

From Management and all the staff - Penta Properties wish everyone a Merry Christmas and happy New Year 2010