Sydney, Melbourne hit a peak in June
The average rent for a Sydney house rose 2 per cent to a record high of $510 a week in June with units rising to $500, according to Australian Property Monitors. Melbourne house rents remained flat for the quarter to $380, with units rising 1.4 per cent to $370. Both of these cities’ quarterly gains come despite anticipation of increasing supply and some rental weakness in the suburban areas. Rates in Brisbane, Perth, Adelaide, Darwin and Canberra all fell, with Darwin seeing the largest quarterly drop in home rental prices of 7.1 per cent and Canberra’s fall in unit prices of 3.8 per cent leading the pack. “Overall, around the country, rental growth for units continues to outperform houses in most capitals reflecting affordability barriers and lifestyle choices,” APM reports. Read the full report here.
Auctions quiet through traditionally slow weekend
RP Data reports 1533 auctions are scheduled nationally this week, led by Victoria with 595 properties going under the hammer. NSW has 535 properties listed for auction, Queensland has 262 up for bid, South Australia has 75, ACT 35 and Western Australia has 23. Analysts expect volumes to increase next week. Prices have been rising in the last month, wiping away losses from late autumn even as volumes have fallen. At the current pace, home values will appreciate at greater rates than last year in Sydney and Melbourne. Read the full story here.
Foreign funds nosedived last quarter
A month ago, we were all talking about how foreign capital as a share of the property market had climbed to an all-time high. Well... that didn’t last long. NAB survey figures released yesterday show that foreign property investment in new construction appears to have fallen off a cliff, with a drop from 13.9 per cent in the March quarter to 10.2 per cent in June – the lowest total in two years – and a drop from 9.5 per cent in the March quarter to 7.2 per cent in June for established homes. While the data on foreign investment can be spotty – analysts basically threw up their hands when asked how they derive their data – this NAB report may cool the ardor of MPs looking to score points chasing scofflaw overseas buyers. On the other hand, growing public attention on foreign investment may have played a role in the apparent reduction in foreign investment. NAB’s quarterly residential property survey also showed that respondents believe the property market is slowing across Australia. Notably, the survey is a trailing indicator using data from an uncharacteristically weak fall season. Read the full story here.
Home loans have crowded out business lending
Australia’s Big Four banks have become so focused on home loans that they’ve essentially neglected the corporate market, leaving it to private equity and foreign lenders. The strictures of capital holding requirements under Basel III give privileges to home lending for Australia’s major banks, requiring less reserve to make a loan on a home than a loan to a company. Major corporate acquisitions recently have relied on foreign funding as a result. Read the full story here.
Real estate agent fined, stripped of licenses
Mark Blinksell, owner of Canberra’s Grapevine Real Estate, earned a fine of $10,000, the loss of his professional real estate license and a suspended jail sentence last week after being convicted of misappropriating $22,000 from a client for his own uses. A Canberra couple gave Blinksell a $22,000 cheque as the deposit for a house contract. Rather than deposit it in a trust as required by law, Blinksell stashed it in his own account and used more than half to pay a home loan held in the name of his wife and daughter, with the rest going to incidentals. Blinksell paid his client back in full, with interest, but that doesn’t absolve him of the misdeed. Read the full story here
With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now