<p>Repeat buyers are one of the strongest measures of confidence in any apartment development.</p>

<p>At <a href="https://www.apartments.com.au/new-apartments/era-newcastle-west-124-126-bull-street-newcastle-west-nsw-2302">ERA</a> in Newcastle West, some purchasers are returning to <a href="https://www.apartments.com.au/developers/gwh">GWH</a> after living at the developer's One Apartments. Their decision to purchase again was driven by the quality of life they found after moving into their first GWH home.</p>

<p>Keith Wilton had spent years living in a house in East Maitland before deciding it was time for a change. Apartment living had always been on his radar, but he was selective about what he wanted.</p>

<p><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/FH_1EzB-1vs?si=XScVlP1ERsTDJoME" title="YouTube video player" width="560"></iframe></p>

<p>"I had some boxes I wanted to tick," he says.</p>

<p>Keith points to the open-plan design, generous outdoor areas and considered inclusions as key reasons One Apartments worked for him.</p>

<p>“One of those things was a nice indoor open plan area, but also I wanted a nice outdoor open area that I could entertain on in summer or Christmases or birthdays,” he says.</p>

<p>He also found value in the smaller details, from integrated appliances to shared resident spaces including the pool, cinema and rooftop areas.</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=356818]</p>

<p>After comparing several developments, he chose One Apartments because of GWH's longstanding local reputation and his own experience working with the developer on a commercial project more than a decade earlier.</p>

<p>"I knew that they were local, that the quality of the build was going to be up there. I'd looked at other apartment complexes around and close by, and I just knew that here was a better decision location wise."</p>

<p>Today, Keith says the move has completely changed how he experiences Newcastle.</p>

<p>"I enjoy living in this location because it's more of a lifestyle change. That Newcastle city living where you can walk to restaurants and bars and even beaches and parks and even shopping across the road."</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=356828]</p>

<p>Beyond the location, he says it's the sense of community that has surprised him most.</p>

<p>"Everyone loves living here because they chose to live here, but everyone looks out for each other. It's a real great community feel here."</p>

<p>For Aimee and Lyle Goodman, the journey started almost by chance.</p>

<p><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/tsioMLcnjas?si=zq-ys3JuWpfa5hFv" title="YouTube video player" width="560"></iframe></p>

<p>The couple happened to be having coffee in Newcastle when they noticed the site where One Apartments was about to begin construction.</p>

<p>"We were aware GWH was planning a development," Aimee says. "We made one phone call and things moved pretty quickly after that."</p>

<p>As busy business owners, they initially thought apartment living would simply reduce the maintenance that came with larger homes. Instead, it fundamentally changed how they spent time together.</p>

<p>"We actually catch up more as a family now," Aimee says.</p>

<p>"We've had homes with big yards and lots of space, but everyone ended up in different rooms. Here we'll have dinner together, the kids can play, and we spend far more quality time together."</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=356829]</p>

<p>Lyle says their confidence came from GWH's reputation within Newcastle's building industry.</p>

<p>"I know people who've worked across different apartment projects, and whenever GWH came up the feedback was always the same. They're rock solid. They're quality."</p>

<p>That confidence only grew throughout the buying process.</p>

<p>"One of the things that really impressed us with GWH was the whole process, was the communication," Lyle says. "It was consistent, it was regular, there was no problem if we had some weird questions, there was no problems in getting answers."</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=351104]</p>

<p>Aimee says one moment stood out.</p>

<p>"The project actually finished on time. We realised we needed to hurry up and sell our house because everything was happening exactly when they said it would."</p>

<p>The positive experience at One Apartments ultimately gave all three buyers the confidence to purchase again with GWH, this time at ERA.</p>

<p>Their confidence reflects what many buyers are seeking in today's apartment market. Location remains important, but so too does certainty around delivery, quality and long-term liveability.</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=356822]</p>

<p>ERA builds on those foundations with 280 one, two and three-bedroom apartments across two landmark towers in <a href="https://www.apartments.com.au/developments/newcastle-west-nsw-2302">Newcastle West</a>.&nbsp;</p>

<p>Designed by <a href="https://www.apartments.com.au/architects/fk-australia">Fender Katsalidis</a>, the project will include more than 2,000 square metres of resident amenities, including a resort-style pool, gym, sauna, private cinema and rooftop entertaining spaces overlooking the harbour and coastline.&nbsp;</p>

<p>The development is also within walking distance of the Newcastle Interchange, Honeysuckle, Darby Street, the harbour foreshore, restaurants, retail and the city’s beaches, continuing the walkable lifestyle that existing GWH buyers say has transformed how they live.</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=356826]</p>

<p>For Keith, the appeal remains straightforward.</p>

<p>"You feel at home even before you've moved into your home."</p>

<p>For Aimee, the change is measured in time.</p>

<p>“I just felt like I had more time,” she says.</p>

<p>[smartcode_project:default project_id=135096 project_image_fid=351102]</p>

<p>Construction at ERA is now underway, with more than half of the residences already sold and limited two and three-bedroom apartments remaining in the East Tower release. Priced from $980,000 for two-bedroom residences and $1.46 million for three-bedroom residences, buyers can secure an apartment with a 10 per cent deposit, with premium homes offering ocean views from Level 8 and harbour views from Level 10.</p>

<p>ERA is also backed by Resilience Insurance's 10-year Latent Defects Insurance policy, providing protection against structural or waterproofing defects for 10 years after completion. The project is anticipated to be completed in early 2028.</p>

<p>[smartcode_project_cta:default project_id=135096]</p>


Joel Robinson

From ONE to ERA: Why buyers are choosing GWH again in Newcastle West

<p>Virgate Property Group is preparing to commence construction of Verdé, its new apartment development in Melbourne's Arts Precinct at Southbank, following a strong run of sales that has seen more than half of the project's 173 apartments secured.</p>

<p>Verdé has attracted a broad mix of first home buyers, owner-occupiers upgrading from nearby inner-city suburbs and investors, with younger owner-occupier couples aged between 28 and 45 accounting for the strongest enquiry. Many are already living in Southbank, South Melbourne, Albert Park, Port Melbourne, South Yarra and the CBD.</p>

<p>"Verdé is located in one of the most desirable pockets of southern Melbourne," Blair Property Group Director Darren Blair, who is managing sales at Verdé, said.</p>

<p>"It's within walking distance of the Arts Centre, Royal Botanic Gardens, Albert Park Lake, and Southbank's restaurants and retail. It's a great lifestyle location with strong amenity and liveability, which made it a very attractive choice for the project."</p>

<p>[smartcode_project:default project_id=4661 project_image_fid=372549]</p>

<p>Virgate was already familiar with the precinct, having previously delivered the successful Domain House development in neighbouring South Melbourne. That experience gave the developer confidence to acquire the Coventry Street site and continue expanding its presence in Melbourne's inner south.</p>

<p>"We had been keeping an eye on the site and the broader precinct for a few months before deciding to move forward with the acquisition," Virgate said.</p>

<p>The project was ultimately secured in 2020 following feasibility studies, planning assessments and due diligence, with the brief centred on delivering "a high-quality, considered design that feels both refined and fit for purpose."</p>

<p>[smartcode_project:default project_id=4661 project_image_fid=314259]</p>

<p>Designed by <a href="https://www.apartments.com.au/architects/bruce-henderson-architects">Bruce Henderson Architects</a>, Verdé comprises 173 one, two and three-bedroom apartments priced from $599,000. The architecture is distinguished by a faceted glass façade that responds to both the site's outlook and Melbourne's changing light conditions.</p>

<p>According to Bruce Henderson Architects, the coloured glazing gives the building a distinctive identity while also providing privacy and solar shading, with residences oriented to capture views across the bay, city skyline and surrounding parklands.</p>

<p>Inside, <a href="https://www.apartments.com.au/interior-designers/designoffice">DesignOffice</a> has created interiors focused on natural light, efficient planning and enduring materials. Apartments feature engineered oak flooring, natural stone benchtops, floor-to-ceiling glazing and SMEG appliances, while a restrained material palette aims to complement the expansive outlooks rather than compete with them.</p>

<p>[smartcode_project:default project_id=4661 project_image_fid=372550]</p>

<p>Resident amenity has also been designed around everyday functionality rather than occasional use. Facilities include a concierge-serviced lobby, residents' lounge with fireplace, library and co-working space, gym, terrace garden with barbecue facilities, ground-floor café, and package delivery management.</p>

<p>The project's location continues to be one of its strongest drawcards. Positioned on Coventry Street, Verdé sits within walking distance of the National Gallery of Victoria, Arts Centre Melbourne, Royal Botanic Gardens and Albert Park Lake, while Southbank's dining precinct, Sturt Street trams and the new ANZAC Station are all nearby. The surrounding education catchment also includes Melbourne Grammar, Melbourne Girls Grammar, Mac.Robertson Girls' High School and several major university campuses.</p>

<p>The sales team says buyers have responded particularly well to the combination of location, design quality and long-term liveability.</p>

<p>"They're responding really positively to the quality of the design, premium resident amenities and the uninterrupted views. Many also appreciate the location and how connected it is to everything they need."</p>

<p>The ability to secure stamp duty savings before completion has also been a key factor for purchasers, alongside the opportunity to personalise finishes ahead of settlement.</p>

<p>With construction set to commence soon and more than half the apartments already sold, Verdé enters its next phase as one of the Arts Precinct's more established apartment developments, offering remaining buyers an opportunity to secure a residence before construction advances further. Expected completion is scheduled for late 2027.</p>

<p>[smartcode_project_cta:default project_id=4661]</p>


Virgate's Verdé Southbank moves toward construction as sales fly past halfway stage

<p>Downsizer-focused apartment development Kooyongkoot in Hawthorn has been recognised at the 2026 Better Future Melbourne Design Awards, taking home Gold and Silver awards in two categories.</p>

<p><a href="https://www.apartments.com.au/new-apartments/kooyongkoot-hawthorn-1-kooyongkoot-road-hawthorn-vic-3122">Kooyongkoot</a>, currently being delivered by developer PQD and designed by Cera Stribley, received Gold in the Interior Design – Proposed category and Silver in the Architecture – Proposed category.</p>

<p>The dual recognition reflects the design approach behind the boutique development on prestigious Kooyongkoot Road, where the focus has been on creating homes for downsizers seeking the space, quality and functionality of a detached house within a low-rise apartment building.</p>

<p>Rather than maximising apartment numbers, <a href="https://www.apartments.com.au/developers/pqd">PQD</a> and <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a> limited the development to just 18 residences, allowing for larger floorplans, greater privacy, generous landscaping and expansive communal spaces.&nbsp;The majority of the apartments also benefit from corner aspects, allowing for dual sources of natural light.</p>

<p>Now around 70 per cent complete and on track for completion in November 2026, Kooyongkoot will comprise a mix of garden residences, ter​race apartments, sub-penthouses, and is crowned by two half-floor penthouses with direct lift access and private rooftop terraces.</p>

<p>[smartcode_project:default project_id=102717 project_image_fid=355297]</p>

<p>The Silver Award for Architecture recognised the way the building responds to its prominent corner position at the ent​rance to Hawthorn's Scotch Hill precinct, one of Melbourne's most established residential neighbourhoods.</p>

<p>Rather than competing with the grand homes that line Kooyongkoot Road, the architectural approach focused on restraint and longevity, using curved brickwork, generous landscaping and carefully considered proportions to integrate with the existing streetscape.</p>

<p>"The form feels fluid and timeless, as though shaped by the landscape itself – architecture that belongs, rather than competes," said Chris Stribley, Co-Founder and Managing Principal of Cera Stribley.</p>

<p>The judging submission also highlighted practical innovations throughout the building, including lift cores servicing only nine homes each, a central landscaped lightcourt designed to bring daylight and ventilation into the building, and fully enclosed private storage rooms with lighting, power and shelving to better accommodate residents transitioning from larger family homes.</p>

<p>[smartcode_project:default project_id=102717 project_image_fid=355293]</p>

<p>The Gold Award for Interior Design recognised the project's focus on long-term liveability rather than display-home aesthetics.</p>

<p>According to the awards submission, the interiors were designed from the inside out, prioritising how homes would function over decades of daily use through generous proportions, practical storage, durable natural materials and flexible layouts.</p>

<p>The specification includes natural stone throughout, upgraded acoustic glazing, V-ZUG appliances and fully enclosed storage rooms, alongside an amenity offering focused on wellness, entertainment and everyday convenience.&nbsp;</p>

<p>Residents will have access to a gym and yoga studio, a wellness centre featuring traditional and infrared saunas, a cold therapy shower and treatment room, as well as a residents' lounge and golf simulator/cinema room for entertainment.&nbsp;Kooyongkoot has also considered the everyday convenience of its residents by offering a private carwash and pet wash facilities on site as well as dedicated parcel lockers and oversized fully enclosed storage rooms.&nbsp;</p>

<p>[smartcode_project:default project_id=102717 project_image_fid=355303]</p>

<p>The project's attention to detail has already resonated with buyers. Earlier this year, Kooyongkoot recorded one of Boroondara's highest apartment sales when an $8 million penthouse was purchased by a Melbourne CEO downsizing from a nearby family home.</p>

<p>"Every detail feels deliberate, from the overall design down to the smallest touches," the purchaser said.</p>

<p>"The level of quality and refinement is exceptional, but what really sold it was how liveable it felt... It felt like a place where everything had been considered, not just a luxury building."</p>

<p>[smartcode_project:default project_id=102717 project_image_fid=355304]</p>

<p>Sustainability also formed a key part of both award submissions. Kooyongkoot is targeting a minimum 7.5-star NatHERS rating across all residences, supported by passive design principles, high-performance glazing, EV charging infrastructure, water reuse systems and a wellness model focused on lower-energy dry facilities rather than pools and large wet areas.</p>

<p>Located within walking distance of Scotch College, Methodist Ladies' College, Koo​yong Lawn Tennis Club, Aubur​n Village and Camberwell Junction, Kooyongkoot continues to target owner-occupiers looking to remain in Melbourne's inner east without compromising on space or quality. A limited selection of two, three and four-bedroom residences remains available, with prices starting from $1.9 million.</p>

<p>[smartcode_project_cta:default project_id=102717]</p>


Kooyongkoot wins Gold and Silver at Better Future Melbourne Design Awards

<p>New apartment supply has become increasingly constrained across <a href="https://www.apartments.com.au/developments/parramatta-nsw-2150">Parramatta</a> in recent years, with fewer projects progressing through to completion as development conditions have become more challenging.</p>

<p>It makes <a href="https://www.apartments.com.au/developers/novm">NOVM</a>'s 2021-completed <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> one of the most recently completed residential towers on the Parramatta River, and among the newest apartment developments in Sydney's second CBD.</p>

<p>With the project largely completed before the sharp escalation in construction costs and inflation following the pandemic, The Lennox is now offering pricing that would be difficult to replicate in a comparable new development in Parramatta today, or across much of Western Sydney.</p>

<p>The majority of the 413 apartments at The Lennox sold before and shortly after completion. A limited release of the remaining apartments has recently been brought to market by capital partner <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a>, with entry-level pricing from $700,000 and two-bedroom apartments available from under $1 million.</p>

<p>Rising above the Parramatta River at 12 Phillip Street, The Lennox comprises one, two, three and four-bedroom apartments, appealing to first home buyers, young professionals, families, downsizers and interstate investors seeking a completed apartment in one of Australia's fastest-growing economic centres.</p>

<p>[smartcode_project:default project_id=5743 project_image_fid=372394]</p>

<p>Rather than positioning Parramatta as an alternative to Sydney's CBD, Equitifund believes the city has reached a point where it stands on its own merits.</p>

<p>"Parramatta is no longer simply an alternative to Sydney CBD, it's becoming a destination in its own right," Equitifund Executive Chairman Greg Huxley said.</p>

<p>"The Lennox captures that evolution with a level of quality and amenity that's difficult to match at its price point."</p>

<p>[smartcode_project:default project_id=5743 project_image_fid=953]</p>

<p>Designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, the tower responds directly to its riverfront setting through expansive glazing and open-plan layouts that maximise views across the Parramatta River and city skyline. Interiors feature engineered timber flooring, stone benchtops, stainless steel appliances and floor-to-ceiling glazing, while generous balconies extend the living spaces outdoors.</p>

<p>Marchese Partners says the project was conceived to balance high-quality apartment living with practical, long-term functionality, pairing larger, efficient floorplans with amenities more commonly associated with five-star hotels.</p>

<p>That emphasis continues through the resident facilities, which include a 20-metre rooftop swimming pool, fully equipped gym and wellness spaces, full-time concierge, a residents' lounge, function room, private lifts, secure basement parking and rooftop communal areas overlooking the Parramatta River. Ground-floor boardwalk retail and dining further activate the riverfront and integrate the building into the surrounding public realm.</p>

<p>[smartcode_project:default project_id=5743 project_image_fid=925]</p>

<p>Australian housing and finance group Equitifund has secured the remaining apartments, believing there are few completed apartment opportunities in Parramatta that offer the same combination of location, amenity and pricing.</p>

<p>Equitifund National Sales Director Ben Hamblett says buyers are increasingly recognising that premium apartment living no longer needs to come with Sydney CBD pricing.</p>

<p>"The Lennox is where aspirational living becomes attainable," Hamblett said.</p>

<p>"Wake to river and mountain views, step into Sydney's Second CBD, and arrive home to resort-calibre amenities, all without the harbour price tag."</p>

<p>Hamblett says owner-occupiers are also attracted by the convenience of having Westfield Parramatta, Church Street's dining precinct, Parramatta Park, Riverside Theatres, Western Sydney University and major transport connections all within walking distance.</p>

<p>"At The Lennox, lifestyle is not an afterthought, it is the foundation."</p>

<p>[smartcode_project:default project_id=5743 project_image_fid=5374]</p>

<p>The Lennox places residents within walking distance of Parramatta Square, Westfield Parramatta, Church Street Eat Street, Parramatta Station, the ferry wharf, Light Rail, the future Sydney Metro West, Parramatta Park and CommBank Stadium, reinforcing Parramatta's position as one of Australia's most connected metropolitan centres outside Sydney's CBD.</p>

<p>Equitifund says buyers visiting the display suite consistently comment on the quality of the finishes, generous floorplans, river and skyline views, and the walkability of the location. The project has attracted a broad mix of local professionals, upsizers, downsizers, buyers relocating from Sydney's inner suburbs and interstate investors seeking long-term growth opportunities.</p>

<p>That demand aligns with Parramatta's continued evolution as an economic powerhouse. Equitifund Research and Market Insights specialist John Bekiaris says sustained population growth, infrastructure investment and expanding employment opportunities continue to support long-term housing demand across the city.</p>

<p>"Parramatta has evolved from a satellite city into one of Australia's most important economic centres. Population growth, infrastructure investment and employment are all supporting sustained long-term housing demand."</p>

<p>[smartcode_project_cta:default project_id=5743]</p>


The apartment price gap drawing Sydney buyers west

<p>A luxury beachfront apartment at Rainbow Bay has more than doubled in value since it sold off the plan six years ago, setting a new local apartment record in the process.</p>

<p>The three-bedroom apartment in the Flow development on Petrie Street, the first of four new projects locally by Paul Gedoun's S&amp;S Projects, has sold for $7.4 million, after originally selling for $3.27 million when the project launched in 2020.</p>

<p>The seventh-floor apartment, comprising 187 sqm of internal living space and a 54 sqm balcony overlooking Froggies Beach and Snapper Rocks, was purchased by a local family.</p>

<p>The transaction was negotiated by Pezet Matheson director Kerry Pezet and equates to more than $30,000 per sqm.</p>

<p>Pezet said the sale reflected the limited opportunities to buy into the boutique beachfront development.</p>

<p>"The sale highlights the rarity of opportunities within the boutique beachfront development, where residences seldom become available," Pezet said.</p>

<p>"Flow is one of the Gold Coast's most tightly held buildings. Buyers from our database move quickly when residences become available, and achieving an off-market sale at $7.4 million demonstrates the depth of demand for property of this calibre."</p>

<p><img alt="Flow" data-entity-type="file" data-entity-uuid="c585b206-2130-4eee-a50c-3f27c51a7c70" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-06%20at%208.33.25%E2%80%AFPM.png?VersionId=m3pHRDV62Y3fvN.XQuQHq.52ilTWpRLf" /></p>

<p>Flow was the first of four luxury apartment developments delivered by Paul Gedoun's S&amp;S Projects at Rainbow Bay and was completed in 2023.</p>

<p>Positioned on the beachfront overlooking Snapper Rocks, the residence includes three bedrooms, three bathrooms, a powder room and views stretching north along the coastline towards Surfers Paradise.</p>

<p>Pezet Matheson Residential principal Mitchell Lambert said buyers continued to prioritise quality beachfront apartments in tightly held locations.</p>

<p>"Flow Residences offers a rare combination of elevated beachfront positioning, architectural excellence, comprehensive resident amenity and premium finishes, which is exactly what discerning purchasers are seeking," Lambert said.</p>

<p>"The transaction further reinforces Rainbow Bay's reputation as one of Australia's premier coastal lifestyle destinations, where limited supply and growing demand continue to support strong market performance."</p>

<p>Pezet Matheson originally marketed and sold out Flow off the plan, making the latest transaction a return to one of the project's original buyers.</p>

<p>Paul Gedoun is selling his third project, <a href="https://www.apartments.com.au/new-apartments/radia-rainbow-bay-271-boundary-street-coolangatta-qld-4225">Radia Rainbow Bay</a>, after recently completing, and selling out, <a href="https://www.apartments.com.au/buildings/esprit-217-227-boundary-street-coolangatta-qld-4225">Esprit</a>. He has plans for a <a href="https://www.apartments.com.au/news/qld/first-look-s-s-projects-proposes-88-apartment-wellness-tower-at-coolangattas-boundary-street">fourth building</a>, 88 apartments on <a href="https://www.apartments.com.au/new-apartments/209-213-boundary-street-coolangatta-qld-4225">Boundary Street</a>.</p>


Rainbow Bay apartment doubles in price since off the plan sale during pandemic

House Prices

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<p><span>On CoreLogic-RP Data's Index, prices in Melbourne and Sydney have accelerated over the past quarter to an astonishing pace, though this index probably lags.</span><br><br><span>Prices are reported as up for the year, quarter...and even the day...for all capital cities in the index.</span></p>
<p><a href="/images/2015/08/12/RPD%20Sea%20of%20GReen.jpg" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2015/08/12/RPD%20Sea%20of%20GReen.jpg" alt=""></span></p>
<p> </p>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
</body></html>

pwargent-M4siyDbqQY

A new high for Australian home values: Pete Wargent

<html><body>
<p>EXPERT OBSERVER</p>
<p>Whenever a major research firm publishes its latest data on the movement in capital city house prices, media presents that data as fact.<span class="Apple-converted-space"> </span></p>
<p class="p1"><span class="s1">It also, often, makes sweeping conclusions about the meaning of the figures, relative to affordability, the state of the market and the impact on consumers.</span></p>
<p class="p1"><span class="s1">The next firm to publish data will receive the same media treatment: the figures are factual, therefore this is what is means for the market and for buyers and sellers.</span></p>
<p class="p1"><span class="s1">The problem is: the two sets of data are quite different and, in some cases, contradictory.</span></p>
<p class="p1"><span class="s1">By the time figures have been published from five different sources - the ABS, the REIA, SQM Research, Domain and the ever-present but often-puzzling CoreLogic are regularly featured - consumers who have been absorbing all the data will be massively confused and terribly misinformed.</span></p>
<p class="p1"><span class="s1">It’s rare for all sources to agree on how much city markets are rising or falling - or, indeed, <strong>whether </strong>markets are rising or falling.</span></p>
<p class="p1"><span class="s1">According to CoreLogic’s latest data, Melbourne house prices are lower than 12 months ago - but both the ABS and SQM Research disagree. They both have Melbourne about 3% higher than a year ago.</span></p>
<p class="p1"><span class="s1">It’s a similar situation with Adelaide: SQM says the Adelaide housing market is down a little, but the ABS and CoreLogic says it’s risen marginally.</span></p>
<p class="p1"><span class="s1">All three sources believe the Hobart market has risen in the past year, but there is considerable disagreement on how much: CoreLogic says 10.7%, the ABS 15.5% but SQM claims it’s only 6.4%.</span></p>
<p class="p1"><span class="s1">There’s a substantial difference there: SQM says there’s only moderate growth in the Tasmanian capital but the official government source, the ABS, portrays a boom market.</span></p>
<p class="p1"><span class="s1">CoreLogic tells us the Perth housing market is still in the negative but SQM claims that the downturn is over and prices have started to rise again.</span></p>
<p class="p1"><span class="s1">Canberra is either the strongest capital city market in the nation, up 10.4% in the annual terms, or it’s rising only moderately at 2% or 3% - depending on whose figures you believe.</span></p>
<p class="p1"><span class="s1">SQM says the average scenario across the eight capital cities is an annual rise of 2.6%, but the ABS says there’s been no meaningful change, while CoreLogic says the national market is down 2%.</span></p>
<p class="p1"><span class="s1">Newspaper headlines keep telling that prices are falling across Australia, because they tend to publish the CoreLogic figures, but both the ABS and SQM disagree.</span></p>
<p class="p1"><span class="s1">Both those sources have prices higher than a year ago in five of the eight capital cities, and SQM has the national average up 2.6%, but you get quite a different conclusion is you focus on the CoreLogic data.</span></p>
<p class="p1"><span class="s1">The only matters on which the three major sources broadly agree is that the Darwin housing market is down about 4% and that the Brisbane house market is up by 1% or 2%.</span></p>
<p class="p1"><span class="s1">The message for consumers is: don’t take price data published by media too seriously - and don’t base big financial decisions on the published data.</span></p>
<p class="p2"><span class="s2">T<em>erry Ryder is the founder of hotspotting.com.au</em></span></p>
<p class="p2"><span class="s3"><a href="https://mailto:ryder@hotspotting.com.au"><em>ryder@hotspotting.com.au</em></a></span></p>
<p class="p3"><span class="s2"><em>twitter.com/hotspotting</em></span></p>
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terryryder-YECXbqmri2

How to analyze city property price data: Hotspotting's Terry Ryder 

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<div>The ABS released its Residential Property Price Indexes to June 2015 last week. </div>
<div> </div>
<div>As you can see in the first chart below, over the dozen years since September 2003 on average established capital city houses (+89%) have outperformed attached dwellings (+73%).</div>
<div> </div>
<div><a href="/images/2015/09/28/RPI1.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2015/09/28/RPI1.jpg" alt=""></div>
<div> </div>
<div>
<div class="separator">Since the full ABS indices only track back to Q3 2003, Sydney will naturally appear to be a moderate performer on this index, since the harbour city's preceding boom peaked on this data series almost immediately thereafter in Q4 2003.</div>
<div class="separator"> </div>
<div class="separator">The strongest performing cities through the mining boom were Darwin - by a huge margin - and Perth. </div>
<div class="separator"> </div>
<div class="separator">A number of cities in resources regions also performed strongly through the mining construction boom, although that particular dream has turned on a dime into an illiquid nightmare for many owners of property in mining towns.</div>
<div class="separator"> </div>
<div class="separator"><a href="/images/2015/09/28/RPI2.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2015/09/28/RPI2.jpg" alt=""></div>
<div class="separator"> </div>
<div class="separator">
<div>
<strong><span style="text-decoration: underline;">Houses</span></strong><br><br>Looking in the second chart below at established houses only since Q3 2002, Sydney has been playing some serious catch-up over the past three years.</div>
<div> </div>
<div>Melbourne has also had a solid run, while there have been some steady gains of late for Brisbane, Adelaide and Hobart.<br><br>The most interesting point of note is how the long run data since 2002 seems to imply a convergence of the results for all eight of the respective capital cities.</div>
<div> </div>
<div><a href="/images/2015/09/28/RPI3.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2015/09/28/RPI3.jpg" alt=""></div>
<div> </div>
<div>
<strong><span style="text-decoration: underline;">Attached dwellings</span></strong><br><br><span>Meanwhile the attached dwellings only index below reveals a similar pattern, although on average it records a slightly less dramatic incline through the present cycle to date, but less impressive growth in a number of cheaper cities where demand for apartment dwelling is less robust.</span><br><br><span>Note that the ABS data for attached dwellings only runs back to Q3 2003 which partly accounts for the lower growth over the full history of the data.</span>
</div>
<div><span> </span></div>
<div><a href="/images/2015/09/28/Attached%20dwellings.jpg" target="_blank"><span>Click to enlarge</span></a></div>
<div><span><img src="/images/2015/09/28/Attached%20dwellings.jpg" alt=""></span></div>
<div> </div>
<div> </div>
<div>
<div>Of course while these figures are useful indicators they are based upon averages and can mask any number of sub-trends.<br><br><strong><span style="text-decoration: underline;">Suburbs</span></strong>
</div>
<div> </div>
<div>The same holds true for long run analysis of median prices at the suburb level, where miniscule sample sizes can skew results materially.<br><br>There has also been the small matter of a once-in-a-century mining boom combined with a one-off structural shift to lower interest rates to take account of.<br><br>As as a result those "top 100 best performing suburbs" lists almost invariably include a number of remote suburbs that few people have heard of where median house prices are around $150,000.<br><br>Since $150,000 is more or less the cost of building a house today, it follows that the real appreciation in land values has actually been weak, and the strong "growth" results are just as likely to be quirk of sampling.<br><br>The <a href="https://petewargent.blogspot.co.uk/2014/10/long-run-uk-house-prices" target="_blank">house I grew up in</a> is a great example, having apparently achieved incredible compounding capital "growth" of an amazing 9 per cent per annum for fully 35 years!<br><br>Thing is, you take off the cost of the extension, the replacement of the dodgy carport with a garage, and various upgrades to the interior, and the capital growth in real terms has been zero percent.<br><br>Cheaper properties can sometimes come with other associated problems - such as tenancy or vacancy risk - while any unfortunately substantial repair cost (e.g. for the roof) can wipe away years of returns at a stroke due to the lower base cost of the asset.<br><br>Moreover suburb median prices are by and large a waste of time - the only statistics that really tell you anything worthwhile when it comes to real estate are like-for-like sales. </div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
</div>
</div>
</div>
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Long run residential prices: Pete Wargent

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<p>July was another strong month for capital gains across the Sydney and Melbourne housing markets with dwelling values moving 3.3% and 4.9% higher over the month.</p>
<p>The latest month of growth as well as the large number of new dwellings that have been constructed has pushed the overall value of Australian housing to just over $6 trillion dollars.</p>
<p>Across our combined capital city index, dwelling values across the nation’s capitals have increased by 4% over the past three months and 11.1% higher over the year. The annual rate of home value appreciation has been accelerating since March and is now almost as high as the previous cyclical high recorded in April 2014 when values were 11.5% higher over the 12 month period.</p>
<p>Sydney’s annual rate of growth, at 18.4% over the twelve months to the end of July, was the highest on record since 2002.</p>
<p>While growth conditions in Melbourne and Sydney have been extreme, the remaining capital cities continue to see milder rates of growth. The third highest capital gain across the nation’s capitals was recorded in Brisbane where values were 3.9% higher over the past twelve months. At the other end of the spectrum, Darwin values have shown the most substantial correction over the year, down by 5.3% and Perth values are also down, having moved 0.3% lower over the year.</p>
<p>Detached housing has continued to outpace the unit sector for capital gains across every capital city except Darwin and Hobart. Across the capital cities index, house values were 11.6% higher over the year and unit values were 7.2% higher. The gap between house and unit performance is the most substantial in Melbourne where house values have risen 12.3% over the past year compared with a 4.8% rise in unit values. The underperformance of the unit sector can probably be attributed to the large amount of new unit supply that has flowed into the market over recent years as well as the upwards pressure on vacant land prices that is pushing house values higher.</p>
<p>One of the factors driving values higher in the largest cities is the short supply of homes available for sale. As a prime example, in Sydney we are currently tracking approximately 18,150 advertised property listings, which is historically well below average. To provide some context, in late 2011 when market conditions were relatively soft there were slightly more than 40,000 homes available for sale across the Sydney market.  </p>
<p>Conversely, in those cities where the housing market is weakening, listing numbers have shown a consistent rise. Total listing numbers are now 22% higher in Darwin and 17% higher across the Perth housing market. </p>
<p>With listing numbers remain low in Sydney and Melbourne, together with market demand remaining high, buyers have been faced with some urgency in their decision making which is another factor driving prices higher in these cities. Sydney homes are selling in just 26 days with Melbourne homes selling over a slightly longer time frame at 34 days.  The remaining capital cities are taking more than 50 days on average to sell, with Hobart and Darwin the longest at 70 days.</p>
<p>Another indicator of ongoing market strength in Sydney and Melbourne is clearance rates. The success rate for capital city auctions has slipped from the high 70% range to the mid 70% range during winter, however that is still a historically high rate of clearance and the moderation is more than likely seasonal.</p>
<p>Australia’s largest city, Sydney, remains the hottest housing market, with dwelling values moving 18.4% higher over the past year. This is the highest rate of annual growth since 2002.  House values were up by 19.8% over the year and unit values increased by a lower 11.9%. While dwelling values are rapidly rising, rental rates across Sydney are increasing by only 2.5% per annum which means gross rental yields are being pushed to record lows. The typical Sydney house is now showing a gross rental yield of just 3.2% which is the lowest on record while units are showing an average gross yield of 4.2%.</p>
<p>In Melbourne, growth conditions have picked up over the past three months, with Melbourne recording a higher rolling quarterly rate of growth than Sydney at 6.1%. Detached houses continue to be the main driver of Melbourne’s appreciating home values. House values were 12.3% higher over the year compared with a 4.8% gain in unit values.  Similar to Sydney, rental growth has been subdued across the Melbourne regions with dwelling rents increasing by just 2.1% over the past twelve months. The average gross yield on a Melbourne house is now at record lows at just 3.0% while units are returning an average gross yield of 4.1%.</p>
<p>Brisbane’s housing market was the third strongest performer across the capital cities for capital gains over the past twelve months, with dwelling values rising 3.9%. The capital gain has been driven exclusively by the detached housing sector where house values have moved 4.6% higher over the year compared with a 2.5% fall in unit values. Compared with the other largest capital cities, rental yields are much healthier in Brisbane with the average gross yield on house recorded at 4.4% while the unit market is showing a higher 5.5% average gross yield.</p>
<p>Adelaide’s housing market recorded a 1.1% dip in dwelling values over the month of July, taking local values 0.2% lower over the first seven months of the year. Adelaide home values have increased by 3.4% over the past twelve months, and comprised of a 3.4% rise in house values and a 3.1% rise in unit values. Adelaide rents have remained virtually flat over the past year, with house rents increasing by 0.4% and unit rents up by 0.3%. The sluggish rental markets has seen gross rental yields across Adelaide slip a little further to register at 4.2% gross for houses and 4.7% gross for units.</p>
<p>Perth’s home values have remained relatively steady over the past year with dwelling values across the western most capital city falling by 0.3% over the past twelve months. The decline in dwelling value has been confined to the unit market where values have fallen by 5.7% over the year compared with house values which were virtually flat over the year with a 0.1% upwards movement. The local rental market is seeing larger declines, with house rents down 5.5% and unit rents falling by 7.2%. The large fall in weekly rents is also pushing local yields down, with the typical Perth house now showing a 3.9% gross yield while units are returning a gross yield of 4.5%.</p>
<p>The housing market across Hobart is once again on an improving trend with local dwelling values moving 2.6% higher over the first seven months of the year and 2.5% higher over the past twelve months. Hobart’s market still has some way to go before staging a nominal recovery, with dwelling values remaining 6.6% lower compared with the previous 2009 peak in dwelling values. House rents are up 2.1% over the past twelve months and unit rents are 4.1% higher which has pushed local gross rental yields to the second highest of any capital city.  </p>
<p>Darwin’s housing market is well into a correction with dwelling values down 5.3% over the past year. House values have recorded a larger fall than unit values, down 5.7% compared with a 3.2% fall in unit values. Weekly rents are also moving lower; house rents have fallen by 9.5% over the year and unit rents are down 8.1%. Despite the sharp fall in weekly rents, Darwin’s gross rental yields are still the highest of any capital city for detached houses at 5.7% and equal highest with Brisbane for units at 5.5%.</p>
<p>The housing market in Canberra has been on improving trend with values rising 4.9% over the first seven months of the year to be 1.2% higher over the past twelve months. The annual growth in dwelling values has been driven entirely by a rise in house values which are up 1.4% over the past twelve months while unit values are down 0.6%. Local gross rental yields are higher than the capital city average with the typical Canberra house providing a 4.1% average gross yield and units are showing an average gross yield of 5.0%.</p>
<p>The housing markets around Australia are as diverse as ever. While markets are booming in Sydney and Melbourne, they are correcting in Darwin and Perth. Across the regional areas of the country we are seeing coastal and lifestyle markets broadly bouncing back in value as buyer demand ramps up after a long slump, while towns reliant on the resources sector are moving through a downturn.  </p>
<p>The diversity in the housing market highlights the different growth drivers that are evident from region to region. The economies of Sydney and Melbourne are relatively sheltered from the downturn in the resources sector and are benefitting from a very healthy services sector while the mining states and territories are experiencing softer economic conditions and a wind down in population growth.</p>
<p>The increase in the rate of growth across our combined capital cities index is likely to be causing some concern to Australian regulators such as the Reserve Bank and APRA who would have been hoping to see the opposite trend; a slowdown in capital gains in line with tighter lending conditions around investment mortgages.  </p>
<p>The annual expansion in investor related housing credit has continued at a pace that is higher than APRA’s mandated 10% growth per annum, with June figures from the Reserve Bank showing credit for investment housing had increased by 10.9% over the year to reach its highest annual level since 2013. With many banks now placing a premium on investment mortgage interest rates while also looking to slow down their pace of investment lending we would suspect investors will start to comprise a smaller proportion of the market.  </p>
<p>The cumulative effect of tighter lending conditions, more expensive mortgage rates for investors and lower yields, as well as natural affordability constraints and higher levels of new housing supply, is likely to dampen some of the exuberance we have seen across the Sydney and Melbourne housing market. Listing numbers are likely to start their spring climb over the coming month which will provide a timely test of the housing markets strength through spring.</p>
<p><em>Tim Lawless is head of the CoreLogic RP Data research and analytics team and can be contacted <a href="https://blog.corelogic.com.au/author/timlawless/" target="_blank">here</a>.</em></p>
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tlawless-5VLUrbAk9s

Urgency driving prices higher in Sydney and Melbourne: Tim Lawless

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<div>The government's State of Australian Cities report for 2015 revealed some interesting demographic and social trends.</div>
<div> </div>
<div>The report found that population growth in recent years is becoming increasingly capital city focussed over time, and this is projected to become even more so the case over the next five decades.</div>
<p><a href="/images/2016/05/23/A1.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/A1.jpg" alt=""></div>
<p> </p>
<div>In fact, just the four most populous capital cities plus Gold Coast, Sunshine Coast and a handful of other conurbations have accounted for the overwhelming bulk of population growth. </div>
<div> </div>
<div class="separator"><a href="/images/2016/05/23/A2.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/05/23/A2.jpg" alt=""></div>
<div class="separator"> </div>
<div>The other cities and "peri-urban locations" which experienced some population growth were as follows:</div>
<div> </div>
<div class="separator"><a href="/images/2016/05/23/A3.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/05/23/A3.jpg" alt=""></div>
<p> </p>
<div>Projecting trends forward, the government expects the capital city share of population growth to continue increasing relentlessly for the next half century, from about two thirds to more than 80 per cent by 2061:</div>
<div> </div>
<div><em>"The majority of Australia's future population growth is expected to occur in and around its capital cities...Australia's population living in capital cities will more than double by 2061".</em></div>
<p><a href="/images/2016/05/23/A4.jpg" target="_blank">Click to enlarge</a> </p>
<p><img src="/images/2016/05/23/A4.jpg" alt=""></p>
<div>The projections show population growth expanding rapidly so that by 2061 several capital cities will have become very large indeed, including Sydney (8.5 million), Melbourne (8.6 million), Brisbane (5.8 million), and Perth (5.5 million).  </div>
<div> </div>
<div>By contrast the respective populations of the smaller cities aren't expected to change all that much in absolute terms. </div>
<p><a href="/images/2016/05/23/A5.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/A5.jpg" alt=""></div>
<p><br><strong><span style="text-decoration: underline;">House price trends</span></strong></p>
<div>The State of Australian Cities report notes that for regional cities "overall house prices have not recovered strongly since the financial crisis".</div>
<div> </div>
<div>This mirrors quite closely what we have seen in Britain, with house prices rising strongly almost everywhere due to a debt binge broadly from around 2000 to 2008, in Australia's case spurred on by a once-in-a-century mining boom. </div>
<div> </div>
<div>But in most regional markets a long period of stagnation has followed since. </div>
<div> </div>
<div>You don't really need data series to demonstrate this point - just read the personal experiences of property investors on chat forums and their collective frustration is more than evident. </div>
<p><a href="/images/2016/05/23/a6.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/a6.jpg" alt=""></div>
<p> </p>
<div>It's been fairly well documented that house price growth has been strong in the largest capital cities, but house price growth has been far from uniform even within the larger capitals. </div>
<div> </div>
<div>Research conducted on behalf of the Valuer General concluded that price growth continues to be considerably stronger in the suburbs located close to the Central Business District. </div>
<div> </div>
<div><a href="/images/2016/05/23/a7.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/05/23/a7.jpg" alt=""></div>
<p><span>Indeed, research papers by the </span>Reserve Bank of Australia<span> (RBA), </span>AHURI<span> and others have all arrived at the same conclusion.</span> </p>
<div>Concludes the government report:</div>
<div> </div>
<div><em>"Inner urban regions and municipalities such as the Boorondara, inner, northern and eastern statistical districts and the inner Melbourne districts are pulling away from price growth rates of the middle and outer ring regions. </em></div>
<div><em> </em></div>
<div><em>The differences mean residents of outer urban regions are likely to be increasingly constrained in their ability to move to inner regions."</em></div>
<p><a href="/images/2016/05/23/A8.jpg" target="_blank"> Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/05/23/A8.jpg" alt=""></div>
<div class="separator"> </div>
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<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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Non-capital house prices have not recovered strongly since the financial crisis: Pete Wargent 

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<p>The housing market appears to be responding to a number of factors which have spurred further growth in home values. </p>
<p>Official interest rates are at historic low levels which has encouraged borrowing for housing and driven housing debt to record-high levels. </p>
<p>The low interest rate setting is also seeing significant competition amongst lenders which has resulted in substantial discounts to headline mortgage rates. </p>
<p>Furthermore, while the total number of homes available for sale is similar to levels a year ago, there has been significantly fewer newly advertised properties listed for sale over the past few months relative to previous years. </p>
<p>The low number of newly advertised dwellings available for sale has created a sense of urgency for buyers in the market, particularly in Sydney and Melbourne, and resulted in further increases in home values over this growth cycle which has been running for more than four years.</p>
<p>While the banking regulator has implemented policies aimed at slowing investment related credit demand, his has not resulted in a significant cooling in the housing market. The pace of investment related credit growth has slowed from a peak of nearly 11 percent per annum to 5 percent over the most rent 12 months period, however we are now seeing an uplift in lending to investors once more. </p>
<p>Following the most recent interest rate cut, auction clearance rates have elevated to levels not seen for more than a year, particularly in Sydney, the nation’s least affordable housing market.</p>
<p><strong>Interest rates</strong></p>
<p>On August 2, the Reserve Bank (RBA) decided to cut official interest rates by 25 basis points to 1.5 percent. </p>
<p>While interest rates were lowered to historic lows, headline variable mortgage rates were generally reduced by much less, with each of the Big 4 banks lowering their mortgage rates by no more than 14 basis points. </p>
<p>Despite the fact that the interest rate cuts were not passed on in full to mortgage holders, mortgage rates below 4 percent are available for those who wish to move from their current lender.  With most mortgages on a variable rate, any cut to mortgage rates will improve a household’s disposable income.  Furthermore, it has become clear that it will also give them more confidence to increasingly purchase more expensive homes, well in Sydney and Melbourne at least.</p>
<p><strong>Housing debt</strong></p>
<p>Each quarter the RBA publishes ratios of household finances which include the ratio of household debt to disposable income. The latest data to March 2016 shows that the typical level of housing debt is 134.7 percent higher than household disposable income. </p>
<p>The current ratio is a record-high but it is important to remember that it is a national snapshot and conditions across different housing markets are likely to vary substantially.  Since the current phase of growth in home values commenced in the June 2012 quarter, this ratio has lifted from 119.0 percent.</p>
<p>While the ratio of housing debt to disposable income has increased and is at a record-high, the ratio of housing assets to disposable income has also risen as home values have increased. </p>
<p>In the June 2012 quarter, the typical value of household assets was 394.4 percent higher than household disposable income.  </p>
<p>By March 2016, the ratio had increased to 470.8 percent indicating a significant increase in the value housing assets.  Again, it should be remembered that this is a national measure and local market ratios are likely to be vastly different especially within areas of very little value growth over that time as well as those areas in which home values have fallen.</p>
<p><strong>Properties listed for sale</strong></p>
<p>Over the four weeks ending August 21 2016 there were 39,676 new (not previously advertised for at least six months) residential properties listed for sale and 229,386 total (includes new and relisted properties) properties advertised for sale. </p>
<p>The number of newly advertised properties listed for sale was -3.4 percent lower than at the same time last year and new listings have been lower each week year-on-year since early June 2016.  Meanwhile, total listings are -0.9 percent lower than they were a year ago and on a weekly basis have been consistently lower year-on-year since early July of this year.  New and total listings are now starting to increase as we head closer to the beginning of the Spring Selling Season as they do each year.</p>
<p>While the national figures show fewer listings than a year ago, the trends are very different across individual capital cities, particularly in Sydney and Melbourne where home value growth conditions are strongest.</p>
<p>In Sydney, over the past four weeks there were 6,299 newly advertised and 18,951 total properties advertised for sale. Year-on-year, new listings have now been lower than they were the previous year fairly consistently since last November and are currently -20.6 percent lower than they were a year ago. </p>
<p>Over the past four weeks there were 17,949 total listings in Sydney which was 0.8% higher than a year ago. </p>
<p>While total listings are slightly higher than a year ago, there is very little new stock being listed for sale.  New listings are arguably more important than relisted properties, especially if the relisted stock has been for sale for a long period of time and vendors aren’t adjusting their price expectations.   Even though spring is just around the corner, there is very little fresh stock being added to the market.</p>
<p>It is a similar story in Melbourne where there were 7,177 new and 25,846 total residential properties listed for sale over the four weeks to 21 August 2016.  The number of new listings was -9.4 percent lower year-on-year and total listings were -0.8 percent lower.  Again, with spring just around the corner there is a relatively low supply of newly advertised properties hitting the market for sale.</p>
<p><strong>Mortgage demand</strong></p>
<p>One of the big challenges the RBA has is the quality and regularity of mortgage data collection. While housing finance data is published each month, owner occupier housing finance commitments are published both on a number and value basis while investor housing finance commitments are only published on the basis of value not the number of loans. </p>
<p>With the investment segment having become so prevalent, it is a challenge not knowing both the number and value, particularly when investment is so strong in Sydney and Melbourne at a time when home value growth is also so strong. </p>
<p>Adding to the challenge of interpreting housing finance data is the lack of clarity about how off-the-plan unit purchases are captured in the data.  It is unclear as to whether they are classified as construction of dwellings or purchase of new dwellings. Finally re-classification of large swathes of mortgages from lenders away from investment and toward owner occupiers has made reading the market even more difficult.</p>
<p>The latest housing finance data showed that in June 2016 there was $32.6 billion worth of commitments with the value having increased by 2.3 percent over the month following a 1.8 percent rise in May. </p>
<p>Although mortgage lending is rising, it remains -2.1 percent lower than its peak in April of last year. </p>
<p>Over the month, there was $20.8 billion in commitments to owner occupiers and $11.8 billion in commitments to investors.  Both segments of lending rose over the month however, owner occupier lending is -2.4 percent lower than its December 2015 peak while investment lending is -22.0 percent lower than its April 2015 peak.</p>
<p>Owner occupier lending remains quite strong and although investment lending has slowed significantly, there is now scope for it to increase over the coming months.  Without additional details on the number of investment loans it is difficult to know whether the increase is being driven by larger loan sizes, a larger number of loans or a combination of both.</p>
<p><strong>Auction clearance rates</strong></p>
<p>Auction clearance rates are one of the timeliest indicators of the housing market and they tend to be indicative of the broader housing market trends.  It is important to remember that far more homes sell by private sale than by auction and auctions are only a significant proportion of sales in the Sydney, Melbourne and Canberra housing markets.</p>
<p>Auction clearance rates in Sydney last week were at their highest levels in more than a year.  Sydney’s auction clearance rate has been above 70 percent for 18 consecutive weeks and in Melbourne they have been above 70 percent for 7 consecutive weeks.</p>
<p>As already discussed, the supply of homes available for sale, particularly in Sydney and Melbourne, is much lower than it has been over recent years.  This is particularly evident when looking at auction volumes. </p>
<p>Over 2016 so far there have been 18,619 auctions in Sydney compared to 25,399 auctions at the same point in 2015.  This represents a -26.7 percent decline in the number of auctions in Sydney over the year to-date. </p>
<p>In Melbourne there have been 23,779 auctions so far this year which is -9.5 percent lower than the 26,282 auctions to the same point last year.  The low volume of auction stock is likely to be resulting in the ongoing strength in clearance rates across each city.  Less stock for sale creates a sense of urgency for those looking to purchase.</p>
<p><strong>So what does this mean for Spring?</strong></p>
<p>It is too early to say definitively what will happen this Spring but I would be very comfortable stating that what happens with property listings will have a substantial influence on the market’s performance over the period. </p>
<p>Spring is typically characterised by a fairly significant upswing in stock for sale, this is driven by the belief that Spring is the best time of year to sell (that is a topic for another day).  As supply increases, the value growth performance can slow and as we saw last year, auction clearance rates can actually start to dip.  So the amount of stock which becomes available for sale will be an important factor for the strength of the Sydney housing market.</p>
<p>The recent interest rate cut is another important consideration for the market’s performance. Although mortgages and the availability of them, is calculated on the borrower’s ability to repay the mortgage at a much higher interest rate, lower mortgage rates impact households by giving them the option to reduce mortgage repayments and therefore having more money each week in their pocket. </p>
<p>This is because most mortgages are on a variable rate and changes to the interest rate on their largest commitment (the mortgage) have an immediate impact on household balance sheets. </p>
<p>With the recent cut to interest rates, it is unlikely to mean that people that could not previously borrow now can, but it does mean that households that previously weren’t considering moving home or buying an investment property may now be more inclined to do so. </p>
<p>This may result in more confidence from those looking to upgrade their property to list their home which means that they also become an additional purchaser.  If someone is now starting to consider buying an investment property it also means additional demand for housing. </p>
<p>How many new buyers there are in Spring remains to be seen but it may encourage an increase in demand for purchase and could result in more people looking to sell their home.</p>
<p>The other major consideration, particularly in Sydney and Melbourne, but also across the rest of the country is what the prospects are for additional increases in home values over the short and medium term. </p>
<p>Combined capital city home values have been rising for more than four years now however, this has largely been driven by Sydney and Melbourne due to their much stronger economies. While the economies in these cities remain strong, the increasing cost of housing due to the four plus years of value growth may be starting to deter buyers.</p>
<p>When you also consider that rents are increasing at record low levels (falling in some areas) and gross rental yields are at record lows, purchasing a property, particularly an investment, is looking less attractive than it has for some time.  Especially when you also factor in the heightened level of housing construction, most of which is inner city units, which is currently underway.</p>
<p>It is going to be interesting to see how all of these factors play out over the next few months and ultimately how the housing market performs.</p>
<p><em>Cameron Kusher is research analyst for CoreLogic. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.</em></p>
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ckusher-ujnxiKuFQs

Where to for the housing market in Spring? Cameron Kusher

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<p>Most research sources have Melbourne leading on annual house price growth – and it’s not so surprising, when you look at the sales data.</p>
<p>The ABS, the Real Estate Institute of Australia and Domain all have Melbourne leading the nation for house price increases (although Hobart is challenging strongly).</p>
<p>Where’s Sydney in all this? CoreLogic continues to publish massive growth numbers for the Sydney house market, but those other three sources listed in the previous paragraph all record annual growth around 3 or 4 percent for the Sydney housing market.</p>
<p>Quite apart from the ludicrous proposition that you can reduce a metropolitan area with over 700 suburbs down to a single growth figure, this reinforces my view that all real estate statistics are rubbery figures to some degree.</p>
<p>When you have media constantly quoting one source (the one that reports massive annual growth) and then all those other sources which are suggesting Sydney’s price boom is over (but largely ignored by media), it’s difficult to know what to believe.</p>
<p>Here’s what I do know for certain: sales volumes gradually faded in Melbourne throughout 2016 but, late in the year and early in 2017, staged a revival. The city’s various markets are proving very resilient, no doubt boosted by nation-leading population growth and a state economy which, while not as strong as Sydney’s, is performing well.</p>
<p>My research shows that the busiest markets are split between the best of the Middle Melbourne areas and the strongest of the affordable outer-ring areas.</p>
<p>And the most affordable areas of metropolitan Melbourne have taken over as the city’s price-growth leaders. Many have delivered double-digit growth in their median house prices in the past 12 months.</p>
<p>As one example, all suburbs in the Sunshine precinct in Melbourne’s west are above 12%, including some which have grown 23-25% in the past year. Again, this data is presented with a reminder that all real estate figures are rubbery – but when all suburbs in an area are delivering the same strong growth pattern, you can be reasonably confident that something notable is happening.</p>
<p class="BodyCopy">Two Middle Melbourne precincts stand out: the Moreland LGA and the Whitehorse LGA. Both have numerous suburbs where sales activity is still growing.</p>
<p class="BodyCopy">These and other Middle Ring precincts had been fading gradually, in terms of sales activity, throughout 2016 but have come roaring back to life. Sales levels are still lower than the peaks of 2015, but remain very solid and prices continue to grow.</p>
<p class="BodyCopy">Typical growth areas in the Moreland LGA include Glenroy, where sales have been 113, 149, 143 and 165 in consecutive quarters. Other standout suburbs are Coburg, Coburg North, Hadfield, Pascoe Vale, Oak Park and Pascoe Vale South.</p>
<p class="BodyCopy">Whitehorse was the Melbourne market leader in 2015 before sales levels plateau-ed in most of its suburbs throughout 2016. But there has been a recent revival to stronger sales activity, led by Blackburn, Burwood East, Mitcham, Nunawading and Surrey Hills.</p>
<p class="BodyCopy">Four bottom-end markets are close behind in the terms of the number of growth markets: the LGAs of Brimbank (west), Whittlesea (far north), Casey (far south-east) and Hume (far north).</p>
<p class="BodyCopy">The far north of metropolitan Melbourne features strongly. The Whittlesea LGA (seven) and the Hume LGA (five) jointly have 12 suburbs with growing sales activity.</p>
<p class="BodyCopy">Whittlesea is consistently one of the city’s strongest markets, driven by affordability, strong infrastructure and proximity to jobs nodes. The suburb of Lalor, with sales rising from 64 to 101 to 117 to 121 in recent quarters, is typical. Nearby Epping has lifted quarterly sales from 110 to 135 to 145. </p>
<p class="BodyCopy">Neighbouring Hume has similar qualities. The suburb of Craigieburn has recorded sales totalling 175, 228, 239 and 244 in the past four quarters.</p>
<p class="BodyCopy">The leading precinct in the far south-east is the City of Casey, which has five Rising Steadily suburbs, led by Cranbourne, Doveton and Narre Warren.</p>
<p class="BodyCopy">Other affordable outer-ring precincts with growth markets include Melton is the far west, Wyndham in the far south-west and Frankston in the far south-east.</p>
<p class="BodyCopy">Middle-ring areas travelling well, in addition to Whitehorse and Moreland, include the LGAs of Monash (Ashwood, Glen Waverley and Mulgrave), Maroondah (Croydon North, Ringwood and Ringwood East) and Banyule (Heidelberg Heights, Ivanhoe and Greensborough).</p>
<p class="BodyCopy">The worst performers in an otherwise strong Melbourne market are the inner-city apartment precincts.</p>
<p class="BodyCopy">I classify both the Melbourne CBD and Docklands as <em>Danger</em> markets. Sales levels have dropped markedly at a time of increasing apartment supply and growing state and federal measures likely to discourage foreign investors, who are the target of many of the inner-city high-rise projects.</p>
<p class="p1"><span class="s1">T<em>erry Ryder is the founder of </em><a href="https://www.hotspotting.com.au/"><span class="s2"><em>hotspotting.com.au</em></span></a><em>. You can  </em><a href="mailto:%20%3Cscript%20type='text/javascript'%3E%20%3C!--%20var%20prefix%20=%20'ma'%20+%20'il'%20+%20'to';%20var%20path%20=%20'hr'%20+%20'ef'%20+%20'=';%20var%20addy38821%20=%20'ryder'%20+%20'@';%20addy38821%20=%20addy38821%20+%20'hotspotting'%20+%20'.'%20+%20'com'%20+%20'.'%20+%20'au';%20document.write('%3Ca%20'%20+%20path%20+%20'/''%20+%20prefix%20+%20':'%20+%20addy38821%20+%20'/'%3E');%20document.write(addy38821);%20document.write('%3C//a%3E');%20//--%3E/n%20%3C/script%3E%3Cscript%20type='text/javascript'%3E%20%3C!--%20document.write('%3Cspan%20style=/'display:%20none;/'%3E');%20//--%3E%20%3C/script%3EThis%20email%20address%20is%20being%20protected%20from%20spambots.%20You%20need%20JavaScript%20enabled%20to%20view%20it.%20%3Cscript%20type='text/javascript'%3E%20%3C!--%20document.write('%3C/');%20document.write('span%3E');%20//--%3E%20%3C/script%3E"><span class="s2"><em>email him</em></span></a><em> or follow him on </em><a href="https://twitter.com/hotspotting"><span class="s2"><em>Twitter.</em></span></a></span></p>
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Melbourne's two dangerous residential markets

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<div>Sydney house prices have accelerated to be up by 20.36% over the past year to June 2015, according to Residex.</div>
<div> </div>
<div>Sydney house prices jumped by 6.94% for the past quarter alone.</div>
<div> </div>
<div>Rents for houses in Sydney also boomed over past year on this index, up 12.4% to $680/week. </div>
<div> </div>
<div>Sydney unit prices were up 15.44%, with rents up 6.67% to $560/week.</div>
<div> </div>
<div>Not too much doing elsewhere, with prices down marginally for the quarter in Adelaide, and declining moderately over the past year in Perth and Darwin. </div>
<div> </div>
<div><a href="/images/2015/08/04/T1_Stats_Update.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div><img src="/images/2015/08/04/T1_Stats_Update.jpg" alt=""></div>
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Sydney achieves record growth: Pete Wargent

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<div>The December 2015 Residential Property Price Indexes figures confirmed the expected slowing in the final quarter of last year, although more timely private sector indices suggest that nationally prices began to rise again in the first quarter of 2016, perhaps by around +1.5 percent. Let's look through the macro trends from the 2015 figures in three concise parts.<br><br><strong><span style="text-decoration: underline;">Part 1 - Market steadier in summer</span></strong><br><br>The total value  of dwelling stock increased only marginally to $5.9 trillion in the December quarter, rising by $482 billion or +8.9 per cent over the calendar year. This was broadly in line with capital city dwelling price growth of +8.7 per cent, plus a bit more reflecting the value of the new supply of new dwellings.<br><br>The total value of dwelling stock has increased by a third or $1.5 trillion since December 2011, now tallying 3.5 times the size of nominal GDP. </div>
<div> </div>
<div><a href="/images/2016/03/23/R4.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div> <img src="/images/2016/03/23/R4.jpg" alt="">
</div>
<div> </div>
<div>The weighted 8 capital city average indexes showed that both house and unit prices steadied in the last quarter of 2015, with house price growth (+9.3 per cent) outperforming the market attached dwellings (+6.7 per cent) over the course of the calendar year, a triumph for scarcity over affordability. </div>
<p><a href="/images/2016/03/23/R10.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/03/23/R10.jpg" alt=""></div>
<p> </p>
<div>
<strong><span style="text-decoration: underline;">Part 2 - City by city</span></strong><br><br>While Sydney showed the expected moderate final quarter correction and Darwin prices tumbled, Perth saw its prices increase by +0.5 per cent leading a number of commentators to call the bottom on Perth's market cycle and to project moderate gains for 2016.<br><br>Melbourne prices rose by +1.6 per cent to record strong growth of +9.6 per cent for the year, second only to another immense calendar year for Sydney at +13.9 per cent.<br><br>Canberra went on a tear with prices leaping by +2.8 per cent in the December quarter (for +6 per cent growth in 2015). while Hobart prices also spiked by +2.5 per cent for an annual result of +3.5 per cent, mirroring more timely reports from other private sector data providers.</div>
<div> </div>
<div>The most steadily consistent performer has been Brisbane, notching up another solid +1.6 per cent increase for its 14th consecutive quarterly gain and a +4.2 per cent annual increase. Since June 2012 dwelling prices have increased steadily by +17.1 per cent in Brisbane. Adelaide has followed a very similar trajectory with somewhat more suppressed nominal price growth. </div>
<p><a href="/images/2016/03/23/R6.jpg" target="_blank">Click to enlarge</a><br><img src="/images/2016/03/23/R6.jpg" alt=""><br><br></p>
<div>Over the past three years the total value of Australia's dwelling stock has increased by $1.33 trillion, with New South Wales (+$682 billion), Victoria (+$377 billion) and Queensland (+$143 billion) accounting for the bulk of the increase. </div>
<p><a href="/images/2016/03/23/R1.jpg" target="_blank">Click to enlarge</a></p>
<div class="separator"><img src="/images/2016/03/23/R1.jpg" alt=""></div>
<div class="separator"> </div>
<div>Since December 2008 growth in property prices has been driven overwhelmingly by Sydney (+79.8 per cent) and Melbourne (+53.5 per cent), while Brisbane has recorded considerably less price growth (+22.1 per cent) over this timeframe. In fact since that time both Darwin and Canberra have fared better, although the Top End is now in correction mode.</div>
<p><a href="/images/2016/03/23/R2.jpg" target="_blank">Click to enlarge </a></p>
<div class="separator"><img src="/images/2016/03/23/R2.jpg" alt=""></div>
<div> </div>
<div>The ABS also now provides some interesting insights into the unstratified median price of established dwelling transfers, which also inferred a slowdown in Sydney house prices (in fact Sydney unit prices rose more than established house prices on this metric, jumping by +11.4 per cent to $685,000).<br><br>This data series is most instructive in depicting just how far Sydney and Melbourne house price growth has outpaced that of its respective regional market counterparts. </div>
<div> </div>
<div><a href="/images/2016/03/23/R3.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div class="separator"><img src="/images/2016/03/23/R3.jpg" alt=""></div>
<p> </p>
<div>There are myriad ways to look at house price data, some of which involve inflation adjustments and carefully selected data points, while others use hedonic regression analysis, but the simple long run data from March 2002 shows the median transfer price of established houses to be as follows:</div>
<ul>
<li>Sydney up from $365,000 to $910,000</li>
</ul>
<ul>
<li>Melbourne up from $241,000 to $621,000 </li>
</ul>
<ul>
<li>Brisbane up from $185,000 to $499,800 </li>
</ul>
<div class="separator">At the state level the mean dwelling prices tell a broadly similar story to the capital city narrative for the past year, with New South Wales (+$76,300) and Victoria (+$56,100) once again recording the greatest gains in calendar year 2015, while the ACT (+$35,000) and Queensland (+$17,600) also saw notable increases.</div>
<p><a href="/images/2016/03/23/R7.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/03/23/R7.jpg" alt=""></p>
<p><br><strong><span style="text-decoration: underline;">Part 3 - Supply response mixed</span></strong><br><br></p>
<div>Finally, the data denoting the total number of dwellings at the state level shows how New South Wales added just +7,400 dwellings to its total stock in the December quarter. Nationally the total number of dwellings increased solidly by +162,900 or +1.7 per cent in 2015 to 9.62 million, having now increased by +578,600 or +6.4 per cent since December 2011. </div>
<div> </div>
<div>
<span>Over the past four years, while the less densely populated territories of the Northern Territory (+10.2 per cent) and the ACT have added substantially to their stock of dwellings in percentage terms, the same has not been true everywhere. </span><br><br>Of the most populous states Western Australia (+8.9 per cent) and Victoria (+7.8 per cent) have co-ordinated the most material supply response as a percentage of established dwellings. However, the percentage increases in Queensland (+6.8 per cent) and in particular New South Wales (+4.6 per cent) have been less marked, reflected in their respective shallower gradients in the below chart. </div>
<div> </div>
<div><a href="/images/2016/03/23/R8.jpg" target="_blank">Click to enlarge</a></div>
<div> </div>
<div class="separator"><img src="/images/2016/03/23/R8.jpg" alt=""></div>
<div> </div>
<div>This seems likely to in part to reflect stock obsolescence and demolition in the larger capital cities, where older dwellings are often pulled down in order to make way for new apartment developments. However, in some locations there does remain an elevated volume of apartment construction in the pipeline, which you can doubtless see for yourself if you frequent the inner city hubs.</div>
<div> </div>
<div><strong><span style="text-decoration: underline;">The wrap</span></strong></div>
<div> </div>
<div>Overall this historical data reflected already known market trends with the restraints on investor lending propitious in tapering price growth towards the end of the calendar year. At the macro level we can expect price growth nationally in 2016 to be lower than the +8.7 per cent seen in 2015, with investor lending have been successfully curbed and more supply due to come online. </div>
<div> </div>
<div>House price growth has resumed in 2016 in parts of Brisbane and Melbourne, Sydney's market has become a <em>bona fide</em> dichotomy, with many of the inner ring suburbs firing, but the outer ring now recording funereal auction results. Naturally at the sub-regional level results are far more mixed and trends more nuanced.</div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
</div>
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Brisbane racks up 14th consecutive quarterly gain: Pete Wargent

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<p dir="ltr">The time it takes for first home buyers to save 20 per cent deposit for an entry-level house has risen in the last 12 months, according to date released by Domain.</p>
<p dir="ltr">The Domain First Home Buyers Report, which is based on a couple aged 25-34 years old, found first home buyers of houses in Sydney and Melbourne had to save over six years for a house deposit of 20 per cent, up 2.6 per cent on last year.</p>
<p dir="ltr">That's an extra two months for each capital.</p>
<p dir="ltr">Melbourne prospective buyers of a $600,000 entry level house price would take six years, Sydney six and a half for their entry level price of $680,000.</p>
<p dir="ltr">The biggest jump since the same report last year came in Canberra, closely followed by Hobart.</p>
<p dir="ltr">It would take five and a half years in Canberra for a 20 per cent deposit on a $606,500 house, up 5.6 per cent from last year.</p>
<p dir="ltr">Hobart's surging house prices has seen a 6.4 per cent jump in amount of time needed to save since last year, equating to an extra three months.</p>
<p dir="ltr">An entry level home, now $380,000, would take four years and two months to save for in the Tasmania capital.</p>
<p dir="ltr">First home buyers in Perth and Darwin Perth and Darwin have a shorter journey to save for a deposit, with the average time taking less than three and a half years</p>
<p dir="ltr"><img src="https://www.urban.com.au/images/2020/9/24/Time%20to%20buy%20houses%20Domain.png" alt=""></p>
<h1 dir="ltr">Units</h1>
<p dir="ltr">The length of time to save for an apartment has also jumped across most of the capitals, although Perth, Darwin and Brisbane saw their time slashed.</p>
<p dir="ltr">Brisbane's entry to buy an apartment is now -4.9 per cent less than it was last year, now three years and three months, with an entry level unit costing $328,000.</p>
<p dir="ltr">Melbourne and Sydney's time to save increased by a month over the year, Sydney now at five years and seven months and Melbourne at four years and three months.</p>
<p dir="ltr"> </p>
<p dir="ltr"><img src="https://www.urban.com.au/images/2020/9/24/Time%20to%20buy%20units%20Domain.png" alt=""></p>
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