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Housing market reportAustralian Capital City Market ReportPrepared June 2013

Dr Andrew Wilson, Senior Economist Australian Property Monitors

2

Commentary provided by Dr. Andrew Wilson, Senior Economist Australian Property Monitors

1300 799 109 | domain.com.au

Strong autumn launching pad for higher winter activity

Housing market report

April retail sales were also positive rising by 0.2 percent over the month as consumer confidence lifted on the back of lower interest rates.

Latest economic growth figures for Australia had the economy growing by 0.6 percent over the March quarter to be up by a moderate 2.6 percent over the year.

The stockmarket has however weakened over recent weeks following a solid revival through most of 2013, which may prove a negative for prestige markets, particularly in Sydney, where buyer activity in that sector has remain relatively subdued.

Although Australia’s economic performance remains under watch, buyer activity in most housing markets continues to grow, with the normally quieter winter selling season well-positioned for a solid performance on the back of rising buyer momentum through autumn.

Australia’s capital city housing markets have generally concluded a strong autumn selling season, particularly the major cities of Sydney and Melbourne.

Although the Reserve Bank has elected to leave interest rates on hold over June, the stimulus effect of historically low mortgage rates continues to be a significant driver of market activity.

The lower dollar will provide a lift to those export-enhanced local economies, particularly in regard to the mining and tourism industries.

The federal budget has forecast falling economic growth and rising unemployment over the next year, which will provide headwinds for housing markets where local economies are underperforming.

Despite these predictions, latest unemployment data for April was encouraging, falling from 5.6 percent over March to 5.5 percent.

National overview

National | June 2013

Houses

Units

$300k

$400k

$500k

$600k

Oct

05

Apr

06

Oct

06

Apr

07

Oct

07

Apr

08

Oct

08

Apr

09

Oct

09

Apr

10

Oct

10

Apr

11

Oct

11

Apr

12

Oct

12

Apr

13

Median prices, national

source: APM

Cash rate

0

2%

4%

6%

8%

10%

12%

14%

16%

May

91

May

92

May

93

May

95

May

96

May

97

May

98

May

99

May

00

May

01

May

02

May

03

May

04

May

05

May

06

May

07

May

08

May

09

May

10

May

11

May

12

May

13

source: RBA

HousesMedian price Quarterly change Yearly change

Sydney $672,763 1.5% 3.5%

Melbourne $539,078 3.1% 3.2%

Brisbane $437,435 -0.5% 0.3%

Adelaide $432,951 0.1% 0.1%

Perth $595,609 3.2% 6.7%

Canberra $580,229 2.5% 7.1%

Gold Coast $460,000 0.0% 2.2%

National $554,410 1.7% 3.3%

Median prices: 3 months to end April 2013

UnitsMedian price Quarterly change Yearly change

$478,401 0.3% 2.1%

$405,224 4.1% 2.2%

$348,130 -1.7% -6.4%

$281,033 -0.7% -0.4%

$405,547 0.4% -0.6%

$378,003 0.2% 3.3%

$370,000 2.9% -5.4%

$421,354 0.9% 1.1%

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1300 799 109 | domain.com.auSydney | June 2013


QoQ: Quarter on quarter change in median price. YoY: Year on year change in median price. Current period is 3 months to end of April 2013.

WestQoQ: +1.1%YoY: +4.7%


Upper NorthQoQ: +4.9%YoY: +5.0%

Upper NorthQoQ: -3.6%YoY: -0.9%

Northern BeachesQoQ: -0.5%YoY: +6.1%

Northern BeachesQoQ: -1.2%YoY: +0.6%

Lower NorthQoQ: +4.8%YoY: +5.1%

Lower NorthQoQ: +2.8%YoY: +4.2%Can-

BankstownQoQ: +0.9%YoY: +7.4%

Can- BankstownQoQ: -2.3%YoY: +6.3%

Inner WestQoQ: +6.6%YoY: +6.6%

Inner WestQoQ: +0.9%YoY: +0.6%

SouthQoQ: +2.0%YoY: +2.7%

SouthQoQ: -0.9%YoY: +3.5%

City & EastQoQ: +2.7%YoY: +3.5%

City & EastQoQ: 0.0%YoY: +0.8%

South WestQoQ: +3.5%YoY: +6.2%

South WestQoQ: -1.8%YoY: +4.7%

Median price change by region (units)Median price change by region (houses)

Quick statsAuction clearance rate

Average days on market

Average discount

Stock on market

68%

78

5.6%

28k

55%

88

6.6%

-16.8%

6.4%

-12.9%

57%

81

May 2013

May 2013

May 2013

May 2013

12 months ago

12 months ago

12 months ago

Change 12 months ago

Long-termtrend

Long-termtrend

Long-termtrend

Change long-termtrend

Sydney

* January has been excluded due to low number of auctions

40%

50%

60%

70%

80%

Nov

05

May

06

Nov

06

May

07

Nov

07

May

08

Nov

08

May

09

Nov

09

May

10

Nov

10

May

11

Nov

11

May

12

Nov

12

May

13

Auction clearance rates, Sydney*

Houses

Units

$300k

$400k

$500k

$600k

$700k

Oct

05

Apr

06

Oct

06

Apr

07

Oct

07

Apr

08

Oct

08

Apr

09

Oct

09

Apr

10

Oct

10

Apr

11

Oct

11

Apr

12

Oct

12

Apr

13

Median prices, Sydney

source: APM

The Sydney housing market continued to strengthen through May with auction clearance rates rising to near-record levels. The auction clearance rate for units of 74.9 percent was second only to the 76.3 percent recorded in May 2002. Similarly, the auction clearance rate for houses of 65.3 percent was the fourth highest May recorded over the last 23 years, behind only 2001, 2002 and 2003.

Sydney is now clearly the best performing local economy, with an unemployment rate of 4.9 percent in April, the lowest of all the major capitals. Other leading indicators of economic activity such as retail sales, also position Sydney as a leading economic performer.

Investors and mid-range upgraders are currently highly active in Sydney, with both the first home buyer market and the prestige market remaining relatively subdued. Sydney’s inner west region and upper north shore remain particularly popular with buyers.

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1300 799 109 | domain.com.auMelbourne | June 2013



Average discount

Stock on market

70%

97

7.0%

44k

57%

91

7.6%

-2.8%

6.5%

34.2%

64%

74

May 2013

May 2013

May 2013

May 2013

12 months ago

12 months ago

12 months ago


Long-termtrend

Long-termtrend

Long-termtrend


Melbourne


North EastQoQ: +2.1%YoY: +4.1%

North EastQoQ: +11.1%YoY: +6.7%

Inner EastQoQ: +8.3%YoY: +3.7%

Inner EastQoQ: +8.6%YoY: +3.1%

Outer EastQoQ: +5.5%YoY: +6.4%

Outer EastQoQ: +9.9%YoY: +0.9%

InnerQoQ: +8.4%YoY: +7.4%

Inner QoQ: +3.2%YoY: -0.4%


WestQoQ: -5.1%YoY: -7.7%

NorthQoQ: +7.3%YoY: +3.5%

NorthQoQ: -0.4%YoY: -3.0%

South EastQoQ: +2.6%YoY: +4.0%


Inner SouthQoQ: +4.9%YoY: +2.1%

Inner SouthQoQ: +14.3%YoY: +7.5%

Median price change by region (houses) Median price change by region (units)

Auction clearance rates, Melbourne*

Houses

Units

$200k

$300k

$400k

$500k

$600k

Oct

05

Apr

06

Oct

06

Apr

07

Oct

07

Apr

08

Oct

08

Apr

09

Oct

09

Apr

10

Oct

10

Apr

11

Oct

11

Apr

12

Oct

12

Apr

1340%

50%

60%

70%

80%

90%

Nov

05

May

06

Nov

06

May

07

Nov

07

May

08

Nov

08

May

09

Nov

09

May

10

Nov

10

May

11

Nov

11

May

12

Nov

12

May

13

Median prices, Melbourne

* January has been excluded due to low number of auctions source: APM

Melbourne’s housing market has risen since the Easter holiday period, with auction clearance rates on the rise over April and May. Auction listing numbers also rose over this period, with more than 700 extra properties offered for auction compared to the same period a year ago. This indicates that seller-confidence is on the rise in a market that continues to perform at three-year highs.

The Melbourne market has been sustained by upper-price, inner-city home sales, although a more general pattern of buyer activity is emerging. Middle-ring, mid-price range suburbs, particularly to the east of the city, have attracted increased buyer activity.

Changes to the first home owners grant, announced by the local state government, will impact on the Melbourne market, as buyers rush to take advantage of the grant for established home purchases before it expires on the 30th June.

The local Melbourne economy does however remain under a cloud, with the announcement of job cuts, particularly in the manufacturing industry, contributing to the highest unemployment rate of the mainland capitals, which was at 6.2 percent in April.


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1300 799 109 | domain.com.auBrisbane | June 2013



Average discount

Stock on market

43%

118

7.0%

27k

31%

126

8.4%

0.4%

7.6%

12.3%

33%

97

May 2013

May 2013

May 2013

May 2013

12 months ago

12 months ago

12 months ago


Long-termtrend

Long-termtrend

Long-termtrend


Brisbane

Syd

Mel

b

Bris

Ade Per

Can Dar

Hob Nat

0%

1%

2%

3%

4%

5%

6%

Gross rental yield by city, March 2013

Houses

Units

$200k

$300k

$400k

$500k

Oct

05

Apr

06

Oct

06

Apr

07

Oct

07

Apr

08

Oct

08

Apr

09

Oct

09

Apr

10

Oct

10

Apr

11

Oct

11

Apr

12

Oct

12

Apr

13

Median prices, Brisbane

source: APMsource: APM, houses only

Positive signs continue to emerge that the nascent recovery in the Brisbane housing market, evident over the past year, may be sustained.

The Brisbane economy now appears to be back in town, with a sharp fall in the local unemployment rate over April, falling from 6.3 percent to just 5.1 percent. It is no coincidence that the rise in Brisbane’s unemployment rate over 2012 provided a significant impediment to housing market confidence and buyer activity in that city.

Buyer activity remains solid in Brisbane’s established middle-ring suburbs to the north and west of the city. Redland City is also proving popular with Brisbane buyers. First home buyers remain subdued; however investors are increasingly recognising the potential of Brisbane, with its high yields and plenty of upside for capital growth.


CabooltureQoQ: -4.3%YoY: -5.0%

CabooltureQoQ: -14.5%YoY: -19.5%

NW InnerQoQ: -4.7%YoY: +0.3%

NW InnerQoQ: -2.5%YoY: -4.1%

InnerQoQ: +3.5%YoY: +4.6%

InnerQoQ: -2.0%YoY: -4.1%

NW Outer QoQ: -3.4%YoY: 0.0%

Pine RiversQoQ: +1.0%YoY: +2.8%

Pine RiversQoQ: -20.9%YoY: -17.8%

RedlandQoQ: +0.4%YoY: +3.9%

RedlandQoQ: 0.0%YoY: +1.3%

LoganQoQ: -0.8%YoY: -2.2%

LoganQoQ: -29.8%YoY: -41.7%

SE InnerQoQ: +0.9%YoY: +0.9%

SE InnerQoQ: 0.0%YoY: -10.6%

SE OuterQoQ: -1.1%YoY: +1.1%

SE OuterQoQ: +6.3%YoY: +5.2%

NW OuterQoQ: -1.7%YoY: -8.7%

IpswichQoQ: +2.6%YoY: +2.6%

IpswichQoQ: -5.0%YoY: -15.0%



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1300 799 109 | domain.com.auAdelaide | June 2013


NorthQoQ: -0.8%YoY: +1.6%

NorthQoQ: -3.1%YoY: +3.7%

EastQoQ: +1.4%YoY: +1.1%



WestQoQ: -3.2%YoY: -1.5%


SouthQoQ: -0.3%YoY: -3.4%


Quick statsAverage days on market

Average discount

Stock on market

112

6.5%

12k

144

7.9%

-1.6%

6.6%

19.4%

111May 2013

May 2013

May 2013

12 months ago

12 months ago


Long-termtrend

Long-termtrend


Adelaide

Syd

Mel

b

Bris

Ade Per

Hob Dar

Can

0%

1%

2%

3%

4%

5%

6%

7%

8%

Unemployment rate, by state April 2013

Houses

Units

$100k

$200k

$300k

$400k

$500kO

ct 0

5

Apr

06

Oct

06

Apr

07

Oct

07

Apr

08

Oct

08

Apr

09

Oct

09

Apr

10

Oct

10

Apr

11

Oct

11

Apr

12

Oct

12

Apr

13

Median prices, Adelaide

source: APM

source: ABS

Buyer activity in Adelaide remains subdued, reflecting the nature of the underperforming local economy where unemployment over April remained seemingly intractably high at 6.1 percent.

Some positive signs from ABS home loan data for Adelaide, with the number of owner-occupied loans approved in South Australia up by 3.5 percent over the first 3 months of this year, compared to the same period last year.


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1300 799 109 | domain.com.auPerth | June 2013

The Perth housing market can be expected to continue its upward trajectory of growth, with median prices to be at record levels sooner rather than later in 2013. First home buyers remain active in the market motivated by the tight rental market and steeply rising rents. However, signs are beginning to emerge of strains on the local economy from the record levels of new arrivals, particularly given the apparent topping out of the resources boom. Perth’s unemployment rate rose to 5.4 percent over April - the highest monthly level recorded for three years.


Average discount

Stock on market

94

4.6%

23k

109

6.5%

1.5%

7.4%

9.3%

102May 2013

May 2013

May 2013

12 months ago

12 months ago


Long-termtrend

Long-termtrend


Perth

source: APM

Perth

National

$350

$370

$390

$410

$430

$450

$470

$490

$510

Mar

09

Jun

09

Sep

09

Dec

09

Mar

10

Jun

10

Sep

10

Dec

10

Mar

11

Jun

11

Sep

11

Dec

11

Mar

12

Jun

12

Sep

12

Dec

12

Median weekly asking rent, houses March 2013

Houses

Units

$200k

$300k

$400k

$500k

$600k

Oct

05

Apr

06

Oct

06

Apr

07

Oct

07

Apr

08

Oct

08

Apr

09

Oct

09

Apr

10

Oct

10

Apr

11

Oct

11

Apr

12

Oct

12

Apr

13

Median prices, Perth

source: APM


NorthQoQ: +3.9%YoY: +8.2%

CentralQoQ: -3.9%YoY: +6.5%





NorthQoQ: -2.7%YoY: 0.0%

CentralQoQ: -1.5%YoY: -0.5%





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1300 799 109 | domain.com.auCanberra | June 2013

The Canberra housing market continues to tread water, weighed down by a faltering local economy and concerns about public sector job shedding, due to a deteriorating federal budget. Prices growth is expected to remain subdued as a consequence, with the April unemployment rate at 4.7 percent, the highest April rate recorded in the ABS series for the city, and well ahead of the 2.9 percent recorded over April the year before.


Average discount

Stock on market

72

3.8%

1.9k

89

5.5%

13.8%

4.9%

41.0%

69May 2013

May 2013

May 2013

12 months ago

12 months ago


Long-termtrend

Long-termtrend


Canberra


BelconnenQoQ: +1.1%YoY: +2.3%

BelconnenQoQ: +5.6%YoY: +7.6%

GungahlinQoQ: +1.9%YoY: +7.0%

GungahlinQoQ: +10.0%YoY: +1.3%

NorthQoQ: +2.0%YoY: -0.8%

NorthQoQ: -7.9%YoY: -6.3%


SouthQoQ: -13.1%YoY: -7.2%

Woden ValleyQoQ: -5.3%YoY: -0.1%

Woden ValleyQoQ: -9.3%YoY: -5.9%

TuggeranongQoQ: +1.4%YoY: +2.5%

TuggeranongQoQ: +4.6%YoY: +3.9%


Unemployment rate, ACT Median prices, Canberra

2

3

4

5

6

7

8

9

10

11

Apr

08

Oct

08

Apr

09

Oct

09

Apr

10

Oct

10

Apr

11

Oct

11

Apr

12

Oct

12

Sep

12

Apr

13

Houses

Units

$200k

$300k

$400k

$500k

$600k

Oct

05

Apr

06

Oct

06

Apr

07

Oct

07

Apr

08

Oct

08

Apr

09

Oct

09

Apr

10

Oct

10

Apr

11

Oct

11

Apr

12

Oct

12

Apr

13

source: APMsource: ABS


1300 799 109 | domain.com.au


Gold Coast | June 2013

Copyright Australian Property Monitors. Any reproduction of or reference to any part of this report must attribute Australian Property Monitors as the source.


Average discount

Stock on market

159

9.0%

10k

183

11.9%

-17.2%

9.7%

-9.5%

134May 2013

May 2013

May 2013

12 months ago

12 months ago


Long-termtrend

Long-termtrend


The Gold Coast remains on track for a modest revival in buyer activity, following a prolonged period of subdued activity, similar to other major housing markets in South-East Queensland that tend to move in sync.

The performance of the local economy remains a concern however, with the latest April unemployment rate at 6.5 percent, well ahead of Brisbane at 5.1 percent, and the Sunshine Coast at 3.7 percent.

Gold Coast


Gold Coast WestQoQ: 0.0%YoY: +1.1%

Gold Coast EastQoQ: -1.2%YoY: -13.5%

Gold Coast WestQoQ: +1.9%YoY: +5.7%

Gold Coast EastQoQ: +6.3%YoY: -0.1%


60

80

100

120

140

160

180

200

Nov

05

May

06

Nov

06

May

07

Nov

07

May

08

Nov

08

May

09

Nov

09

May

10

Nov

10

May

11

Nov

11

May

12

Nov

12

May

13

Average days on market, Gold Coast

Houses

Units

$200k

$300k

$400k

$500k

$600kO

ct 0

5

Apr

06

Oct

06

Apr

07

Oct

07

Apr

08

Oct

08

Apr

09

Oct

09

Apr

10

Oct

10

Apr

11

Oct

11

Apr

12

Oct

12

Apr

13

Median prices, Gold Coast

source: APMsource: APM


10


1300 799 109 | domain.com.au

Hobart’s housing market remains subdued, reflecting the ongoing impact of a weak local economy. Hobart’s unemployment rate over April was 6.8 percent, and remains the highest of all the capitals, with no real indication of an improvement in the near-term despite low interest rates.

The housing market continues to bump along the bottom, with Tasmanian owner-occupier loans, for the March quarter, up just 1.3 percent compared to the same period last year.

Data contained in this report is subject to revision as a result of time lags with the reporting and collection of sales transaction data. This monthly housing market report is produced for and used by both APM and Domain.

Darwin remains a housing market on the move, driven by an influx of workers and a shortage of accommodation, pushing up rents and prices. The latest unemployment data indicates that, similar to Perth, the Territory is having issues absorbing new job seekers, with a rate of 5.4 percent – the highest monthly rate recorded for over 5 years.

Hobart Darwin

Hobart and Darwin | June 2013


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