The week that was in property

The Reserve Bank (RBA) released the minutes of their February monetary policy meeting earlier this week.

At the meeting, the RBA decided to keep official interest rates on hold at 1.5%.

It is always interesting to read their detailed comments about households and housing and some of these follow in italics.

Dwelling investment had grown at an above-average rate over the previous year, supported by low interest rates and further increases in housing prices.

The large amount of work in the pipeline was expected to support dwelling investment at high levels over the next year or so, although there was some risk of more cancellations than usual if conditions in apartment markets deteriorated.

The combination of increased supply and lower population growth had already depressed rents and apartment prices in Perth and, increasingly, Brisbane. 

In contrast, conditions in the established housing markets in Sydney and Melbourne had strengthened over the second half of 2016 and investor housing loan approvals had risen over recent months.

Members noted that housing market activity in Melbourne and surrounding areas had been supported by strong population growth and improvements in transportation infrastructure. Conditions in housing markets varied considerably across the country.

Housing prices and rents had been falling in Perth and there were signs that the significant increase in the supply of apartments had begun to affect prices and rents in Brisbane.

In contrast, activity in the established housing market had picked up in Sydney and Melbourne in the second half of 2016, and investor credit growth had increased. 

Supervisory measures had strengthened lending standards and some lenders were taking a more cautious attitude to lending in certain segments.

The comments indicate that the RBA notes the regional differences in the performance of housing markets, both ion terms of value growth and rental changes.

After earlier stating value growth was cooling, the RBA also notes the pick-up in growth over the second half of 2016.

They also reiterated that lending standards have improved which is clearly a positive for housing market stability.

CoreLogic collected results for 89.8% of the capital city auctions held over the past week. 

Based on these results, the combined capital city auction clearance rate was recorded at 74.9% across 2,291 auctions.

Clearance rates were higher over the week from the 73.2% clearance across 1,591 auctions the previous week.

Melbourne’s auction clearance rate was virtually unchanged over the week, recorded at 75.7%, down from 75.9% the previous week while auction volumes almost doubled from 556 to 1,091.

The Sydney auction clearance rate was also virtually unchanged at 80.6% last week compared to 80.7% the previous week with volumes rising from 640 to 856.

Combined capital city auction volumes are lower than the 2,357 auctions the same week a year ago while the clearance rate is higher than the 71.8% at that time.

Note that sales listings are based on a rolling 28 day count of unique properties that have been advertised for sale.

The amount of new and total residential properties advertised for sale remains much lower than it was at the same time last year.

Over the 28 days to 19 February 2017, there were 45,787 newly advertised properties nationally which was -5.0% lower than a year ago and across the combined capital cities the 28,661 newly advertised properties was -4.1% lower than a year ago. 

Canberra (+20.5%) is the only capital city where newly advertised properties are higher than they were a year ago, meanwhile the two weakest markets:

Perth (-10.5%) and Darwin (-28.4%) are seeing substantially fewer new homes advertised for sale than a year ago which is a positive development.

There were 225,528 total unique properties advertised for sale nationally over the past 28 days and 100,765 for sale across the combined capital cities.

Nationally, the total number of properties for sale is -9.3% lower over the year while they are -5.2% lower across the combined capitals.

Brisbane (+4.3%) is the only capital city with more properties available for sale currently compared to a year ago.