REAL ESTATE – AUSTRALIA – RESIDENTIAL

First-timers, low earners in housing crunch

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Original article by Nila Sweeney
The Australian Financial Review – Page: 31 : 17-Apr-24

A report from the ANZ Bank shows that the average proportion of income that is needed to service a new mortgage rose to 48.9 per cent nationwide in the March quarter; this compares with 43.1 per cent during the same period in 2023. The ANZ Housing Affordability report also reveals that it now takes an average of 10.3 years to save enough money for a house deposit. Meanwhile, ANZ found that the average renter must now allocate 32.2 per cent of their income to rent; this rises to 54.3 per cent for low-income earners.

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AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Unit values outpace houses in half of suburbs

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Original article by Nila Sweeney
The Australian Financial Review – Page: 32 : 3-Apr-24

Data from CoreLogic shows that growth in apartment prices outpaced detached homes in 633 out of 1,168 suburbs across Australia in the March quarter. This includes 77 per cent of Brisbane suburbs, 54 per cent of suburbs in Sydney and 50 per cent of Melbourne suburbs. Tim Lawless of CoreLogic says the outperformance of apartments could be sustained in the near- to medium-term, due to factors such as housing affordability and supply constraints. Buyer’s agent Amanda Gould says high interest rates are prompting some clients to opt for an apartment rather than a detached dwelling.

CORPORATES
CORELOGIC AUSTRALIA PTY LTD

Rate pause could lure home buyers back

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Original article by Nila Sweeney
The Australian Financial Review – Page: 30 : 20-Mar-24

Tim Lawless of CoreLogic says the Reserve Bank of Australia’s decision to leave the cash rate unchanged on Tuesday is likely to boost the confidence of prospective home buyers. He notes that there has tended to be a close relationship between consumer sentiment and the volume of home sales. Meanwhile, SQM Research MD Louis Christopher expects mortgage stress to continue to rise while interest rates remain high, while the number of distressed listings is also likely to rise.

CORPORATES
CORELOGIC AUSTRALIA PTY LTD, SQM RESEARCH PTY LTD, RESERVE BANK OF AUSTRALIA

New home supply to hit decade low

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Original article by Larry Schlesinger, Michael Read
The Australian Financial Review – Page: 1 & 32 : 19-Mar-24

The Urban Development Institute of Australia has forecast that just 79,000 new home builds will be completed nationwide in 2026. This is 26 per cent lower than in 2023, and the slump in new housing supply is set to further reduce the affordability of homes and rental properties. The dire forecast also casts further doubt on the federal government’s target of building an additional 1.2 million homes over five years. Barrenjoey’s chief economist Jo Masters says this target is ‘aspirational’, and will require high rates of apartment construction; she adds that apartments have a longer construction and lead time than houses.

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URBAN DEVELOPMENT INSTITUTE OF AUSTRALIA, BARRENJOEY CAPITAL PARTNERS PTY LTD

Lending malaise as home loans retreat

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Original article by Megan Neil
The Australian – Page: 19 : 8-Mar-24

Data from the Australian Bureau of Statistics shows that the value of new housing loans fell by 3.9 per cent to $25.12bn in January; this followed a 4.1 per cent decline in December. The general consensus of economists had been for two per cent growth in home loans during January. The value of new owner-occupier loans fell by 4.6 per cent to $15.91bn, and lending to property investors was down 2.6 per cent to $9.21bn. Meanwhile, lending to first-home buyers was down 6.9 per cent, and the value of those loans fell by six per cent.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS

New house pipeline at near-12 year low

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Original article by Michael Bleby
The Australian Financial Review – Page: 31 : 5-Mar-24

Data from the Australian Bureau of Statistics shows that approvals for new detached homes fell by 9.6 per cent month-on-month in January, to the lowest level since mid-2012. Approvals for apartments, townhouses and semi-detached homes fell by 22 per cent. Tamawood CEO Robert Lynch says the house construction market has most likely reached its bottom; however, he cautions that factors such as high interest rates mean that a rebound may take some time. He adds that sales activity in the more affordable segment of the housing market – in which Tamawood specialises – is likely to recover first.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, TAMAWOOD LIMITED – ASX TWD

House prices could jump 5pc: McGrath

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Original article by Campbell Kwan
The Australian Financial Review – Page: 31 & 34 : 20-Feb-24

Real estate group McGrath Limited has posted a 2023-24 interim statutory profit of $7.5m and underlying EBITDA of $4.8m. Meanwhile, CEO John McGrath says the prospect of interest rate cuts later in 2024 may boost prices at the lower end of Australia’s housing market by up to five per cent. He adds that interest rate rises have seen house prices in this segment of the market fall by around five per cent over the last 12 months. However, McGrath says prospective buyers of homes priced below $1m are likely to remain cautious about returning to the property market until interest rate cuts actually occur.

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McGRATH LIMITED – ASX MEA

Cooling inflation, stable rates may encourage buyers

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Original article by Nila Sweeney
The Australian Financial Review – Page: 29 & 30 : 7-Feb-24

Tim Lawless of CoreLogic says the Reserve Bank’s decision to leave the cash rate unchanged on Tuesday could prompt an upturn in house buying activity. He notes that house prices remain below their peaks in Sydney, Melbourne, Hobart, Darwin and the ACT; Lawless says that some buyers may capitalise on this to buy into the market before interest rates fall. Judo Bank’s chief economic adviser Warren Hogan says the rental housing market is still a major concern, while SQM Research MD Louis Christopher warns that rising rents could put upward pressure on inflation.

CORPORATES
CORELOGIC AUSTRALIA PTY LTD, JUDO BANK PTY LTD, SQM RESEARCH PTY LTD

Fall in detached housing approvals puts Labor’s 1.2 million target at risk: economists

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Original article by Olivia Ireland
The Age – Page: Online : 10-Jan-24

Data from the Australian Bureau of Statistics shows that dwelling approvals rose by 1.6 per cent to 14,529 in November. However, building approvals for detached houses fell 1.7 per cent month-on-month, to 8,506. The Housing Industry Association’s chief economist Tim Reardon expects approvals for detached homes to keep falling during the first half of 2024; he adds that this will make it hard to achieve the federal government’s revised target of building 1.2 million new homes over five years. This equates to 240,000 per year, but Master Builders Australia expects about 170,000 new home to be built in 2023-24.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, HOUSING INDUSTRY ASSOCIATION LIMITED, MASTER BUILDERS AUSTRALIA INCORPORATED

House prices could dip before next rate cut

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Original article by Nila Sweeney
The Australian Financial Review – Page: 32 : 30-Nov-23

Domain Holdings is upbeat about Australia’s residential market, forecasting that house prices will rise by seven per cent nationally in 2024. Dwelling prices in Sydney are tipped to rise by up to nine per cent, while prices in Melbourne are expected to gain four per cent. Nicola Powell from Domain says house prices could fall in early 2024, particularly if there is another interest rate rise and inflation remains high. Powell adds that dwelling prices could rebound if there is an interest rate cut later in the year.

CORPORATES
DOMAIN HOLDINGS AUSTRALIA LIMITED – ASX DHA