HOUSE BUYING – AUSTRALIA

Housing prices up: insurers go to war

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Original article by Greg Brown, Jack Quail
The Australian – Page: 1 & 4 : 26-Aug-25

Modelling produced by Lateral Economics suggests that the federal government’s proposed expansion of the home guarantee scheme will adversely affect the first-home buyers it aims to help. The government will allow such people to buy a home with a deposit of just five per cent, and without the need for lenders mortgage insurance. The report, which was produced on behalf of the Insurance Council of Australia, concludes that the policy will result in house prices rising by between 3.5 per cent and 6.6 per cent nationally within its first year. ICA CEO Andrew Hall says house prices will rise by more than the cost of lenders mortgage insurance.

CORPORATES
LATERAL ECONOMICS, INSURANCE COUNCIL OF AUSTRALIA LIMITED

Rate hold may take wind out of home sales

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Original article by Lucy Slade
The Australian Financial Review – Page: 25 : 9-Jul-25

AMP’s chief economist Shane Oliver says the Reserve Bank’s decision to leave the cash rate unchanged on Tuesday is likely to "dampen down" enthusiasm among prospective home buyers. He adds that while the decision will not led to a dramatic shift in sentiment, buyers are likely to be a bit more cautious. Oliver had thought there was an 80 per cent chance of a rate cut in July, but he expects the next cut to occur in August. Eliza Owen from Cotality believes that a rate cut next month is almost certain.

CORPORATES
AMP LIMITED – ASX AMP, RESERVE BANK OF AUSTRALIA, COTALITY

Poll result opens door for housing market

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Original article by Nila Sweeney
The Australian Financial Review – Page: 28 : 7-May-25

Real estate agents note that there has been an increase in the number of homes listed for sale in the last week. BresicWhitney CEO Thomas McGlynn expects this momentum to continue in the next week or so, after Labor secured majority government at the federal election on Saturday. Melbourne-based buyers’ agent Cate Bakos in turn says enquiries from prospective home buyers have also increased in the wake of the election, while Eliza Owen from Cotality says first-home buyers will return to the market when election policies that target them start to be implemented.

CORPORATES
BRESIC WHITNEY ESTATE AGENTS PTY LTD, COTALITY

Foreign buyers to be banned from purchasing existing homes

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Original article by Remy Varga
Herald Sun – Page: Online : 26-Mar-25

The budget papers show that the federal government will impose a two-year ban on foreigners buying established homes, with the policy slated to take effect from 1 April. The budget has allocated $5.7m for the Australian Taxation Office to enforce the ban, while the ATO will be given $8.9m to crack down on ‘land banking’ by foreign buyers. The government will also expand the Help to Buy shared equity scheme for home buyers, and provide eligible construction industry apprentices with grants of up to $10,000 as part of its strategy to address the skills shortage that is contributing to the housing crisis.

CORPORATES
AUSTRALIAN TAXATION OFFICE

Upgraders the dominant force in housing market as prices slow

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Original article by Nila Sweeney
The Australian Financial Review – Page: 33 : 27-Nov-24

Research by CBRE shows that 64 per cent of Australian home buyers in the September quarter were existing home owners who were upgrading to a larger or more expensive dwelling. This compares with 59 per cent in the March quarter. In contrast, the proportion of first-home buyers fell from 66 per cent in the March quarter to 62 per cent. Sameer Chopra from CBRE says upgraders are likely to be taking advantage of factors such as falling house prices in the major capital cities, slowing price growth in medium-sized cities and a strong jobs market. CBRE’s findings are based on a survey of residential property valuers.

CORPORATES
CBRE PTY LTD

Where cash buyers are splurging billions

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Original article by Nila Sweeney
The Australian Financial Review – Page: 27 & 28 : 19-Nov-24

Data from electronic conveyancing firm PEXA Group shows that more home buyers in Australia are opting to pay with cash rather than take out a mortgage. The firm’s analysis of settled residential property transactions during 2023-24 shows that $138bn worth of sales were made using cash across NSW, Victoria and Queenland; this represents a year-on-year increase of 14 per cent. Some 114,000 properties were settled with cash, an increase of 3.9 per cent. PEXA’s chief economist Julie Toth says cash buyers could help to sustain house prices, noting that interest rates have less impact on them.

CORPORATES
PEXA GROUP LIMITED – ASX PXA

Rates on hold will not help home buyers

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Original article by Nila Sweeney
The Australian Financial Review – Page: 26 : 25-Sep-24

Australian home buyers’ borrowing capacity has been cut by around 30 per cent since the Reserve Bank started reducing the cash rate in May 2022. Tim Lawless from CoreLogic says borrowing capacity – and therefore buying activity in the housing market – will not improve until the central bank starts to ease monetary policy. AMP’s chief economist Shane Oliver in turn says demand is unlikely to rise until there are clear signs that the Reserve Bank is about to reduce the cash rate.

CORPORATES
RESERVE BANK OF AUSTRALIA, CORELOGIC AUSTRALIA PTY LTD, AMP LIMITED – ASX AMP

Substantial rate cuts needed for buyers to return

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Original article by Nila Sweeney
The Australian Financial Review – Page: S4 : 10-Sep-24

The issue of housing affordability was discussed at a property summit on Monday. The median house price is just above $800,000 nationwide at present, but Eliza Owen from CoreLogic says a house would need be priced at about $500,000 to be affordable for someone on the median income. She told the summit that the pool of potential house buyers will remain limited until there is a substantial reduction in the cash rate. Meanwhile, Mortgage & Finance Association of Australia CEO Anja Pannek noted that factors such as higher serviceability buffers and interest rates are making it harder for some home owners to refinance their mortgage loan.

CORPORATES
CORELOGIC AUSTRALIA PTY LTD, MORTGAGE AND FINANCE ASSOCIATION OF AUSTRALIA

Average home loan surges to record high

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Original article by Nick Lenaghan
The Australian Financial Review – Page: 30 : 9-Jul-24

Data from the Australian Bureau of Statistics shows that the average new home loan for owner-occupiers reached a record high of $626,055 nationally in May. The average size of new home loans reached fresh highs in Queensland, South Australia and Western Australia in May. NSW still boasts the nation’s highest average home loan, at $767,584; however, this is below the state’s peak of $803,235 in early 2022. In contrast, the average home loan in Victoria fell to $601,891 in May, compared with a peak of $651,364 in 2022. Sally Tindall of RateCity notes that home buyers are taking out bigger mortgage loans than ever, despite the cash rate rising to its highest level in 12 years.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, RATECITY PTY LTD

Australian capital cities rank among world’s least affordable markets to buy a home

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Original article by Clint Jasper
abc.net.au – Page: Online : 14-Jun-24

The Chapman University Frontier Centre for Public Policy examined housing markets in 94 cities in eight countries in terms of their affordability for middle-income buyers. Hong Kong, Sydney and Vancouver were rated as the most unaffordable markets for those buyers, while Sydney, Melbourne, Adelaide, Brisbane and Perth all sit in the least affordable 25 per cent of cities The study concluded that the leading cause of unaffordable housing in the cities it studied were land use policies that artificially restrict housing supply, pushing up land prices, while it pointed to Singapore’s success in transforming a "desperate housing situation" in the 1960s to one of the most affordable markets in the report.

CORPORATES
CHAPMAN UNIVERSITY