RESIDENTIAL RESEARCH MARKET ACTIVITY REPORT FOR AUSTRALIAN CAPITAL CITIES & REGIONAL CENTRES

Transcription

1 RESIDENTIAL RESEARCH MARKET ACTIVITY REPORT FOR AUSTRALIAN CAPITAL CITIES & REGIONAL CENTRES

2 Dec-15 Mar-16 Jun-16 Mar-16 Jun-16 Sep-16 The official cash rate target remained at 1.5 in September Domestic Product (GDP) was recorded at 3.3% annual growth to June 2016 whilst unemployment across Australia remained steady at 5.7% in the quarter to July Australian house values rose 1. in the month of July 2016 (3. annual growth) to a median of $524,000 while apartment values were down 0. over the month (similarly 3. annual growth) to a median of $484,000. In the year to July 2016, the volume of house sales was up 0.3% to 334,068 while 165,471 apartment sales were recorded (up by 2.3%). rental yields for Australian houses averaged 4.3 in July 2016 while Australian apartments achieved 4.5. Australian weekly median house rents were $430 in July 2016 (steady YoY), whilst apartment rents were $425 per week (up 1. YoY). The Reserve Bank of Australia (RBA) left the target cash rate unchanged at 1.5 on 6 September The RBA continues to support the supervisory measures introduced by the Australian Prudential Regulatory Authority (APRA) encouraging tightened lending practices for housing finance across the country. These regulatory measures have resulted in a lowered level of enquiry from both local and foreign purchasers and slowed the rate of annual capital growth across the country. In the year to July 2016, houses in Melbourne saw not only the highest annual growth in values of all Australian capital cities (at 8.7%) but the greatest change in sales volume at 18.. Other housing markets experiencing a high uptick in sales turnover over this time include Adelaide (at 12.3%), Brisbane (at 9.) and Canberra (at 6.). While capital growth was strongest for housing markets in Hobart (at 6.) and Canberra (at 4.7%) as shown in Figure 2. Annual growth for apartment capital values and sales volume has eased in July As new projects come to market, there has been a lull in enquiry as housing finance options are reassessed. Apartments in Sydney continued to see the most growth in this time at 5. followed by Brisbane at 3.9%., Australian Cities, Houses & Apartments Annual % change to July 2016 (H) (A) MEL (H) HOB (H) SYD (A) CAN (H) SYD (H) ADE (H) BRI (A) BRI (H) MEL (A) ADE (A) CAN (A) PER (H) HOB (A) DAR (A) DAR (H) PER (A) A weighted average total vacancy for Australian residential property was last recorded at 2.9% in June 2016; trending down 30 bps in the last quarter. National Key Economic Indicators Knight Frank Residential Research GROSS DOMESTIC PRODUCT UNEMPLOYMENT RATE CASH RATE TARGET QUARTERLY GROWTH OF INVESTOR HOUSING FINANCE, BY VALUE QUARTERLY GROWTH OF OWNER OCCUPIER HOUSING FINANCE, BY VALUE (excl. refinancing) 2

3 Turkey New Zealand Canada Chile **Sweden ***Malta Austria Iceland Mexico Germany Israel Malaysia Jersey Lithuania Colombia Australia Ireland Luxembourg Latvia China Norway India Hungary United Kingdom United States South Africa Slovakia Netherlands Bulgaria ***Czech Republic Global Denmark Belgium Portugal Indonesia Romania South Korea Russia Spain Estonia Finland Switzerland Slovenia France Croatia Poland Japan Brazil Italy Cyprus ****Singapore Greece Morocco **Hong Kong Ukraine Taiwan AUSTRALIAN RESIDENTIAL REVIEW SEPTEMBER 2016 RESEARCH Looking at the capital cities compared to key regional centres around Australia, those on the periphery of the Greater Sydney area have continued to outperform as shown in Figure 3., Australian Key Regional Centres, Houses & Apartments Ranked by quarterly % change to Q Throughout the second quarter of 2016, houses located on the Central Coast saw capital growth of 3. while Wollongong was close behind at 3.3%. Given the heated Sydney market for the past two years, it s understandable that buyers are looking for alternative options with a lower entry point especially when both regions are still within a commuting distance to Sydney. The top performer for the housing market over Q was the NSW South Coast (at 4.9%) with Surfers Paradise (at 3.) and Newcastle (at 2.). These regions are still desirable for second homes and future retirement destinations by baby boomers who are now coming into retirement age. Knight Frank s Global House Price Index released for Q saw global growth of for the mainstream national housing markets. Australia was ranked in 16th place with annual growth of 6. as shown in Figure 4. Australia has dropped from 7th position in Q (when annual growth was recorded at 10.1%). Knight Frank Global House Price Index Ranked by annual % change to Q % 1 5% -5% -1 **Provisional ***Asking prices ****Island-wide price index for non-landed private properties. Data for Australia, Austria, Belgium, Bulgaria, Colombia, Croatia, Cyprus, Czech Republic, Denmark, Finland, France, Hungary, India, Israel, Italy, Lithuania, Luxembourg, Morocco, New Zealand, Romania, Slovenia and Spain to Q1 2016; Data for Malaysia to Q4 2015; Data for Chile to Q

4 State Product in New South Wales was recorded at $506,918 million in the year to June 2015; 2. greater than stood at 4. for Greater Sydney (SA4), trending 176 bps lower than the 5. recorded in July Population in Greater Sydney was estimated at 4.9 million persons in Greater Sydney experienced population growth of 1.7% in the year to June commitments in New South Wales in the three months to July 2016 grew by 11. on the previous year, to $22.0 billion. to July totalled 4,584 houses and 10,729 apartments in Greater Sydney. This is trending 1.3% lower for houses and 2. lower for apartment approvals compared to the same period in % out of 578 scheduled auctions in Greater Sydney. This is higher than the week prior, at 78.5% from 788 scheduled auctions, and also higher than the comparable week a year earlier, when 78.1% (out of 1,080 auctions) were sold. tallied 47,979 houses (up 2. on, Greater Sydney 25% 2 15% 1 5% Rents & Total Vacancy Greater Sydney s & Monthly Vacancy $800 $750 $700 $650 $600 $550 $500 $ % % % % 0. VACANCY previous year) and 46,662 apartments (up 1.9% on prior year). House values declined 1. in the month of July (rising 3.9% over the last year) to a median of $1,057,500. Apartment values fell 0.1% over the same month (rising 5. over the year) to record a median of $703,500. fell 5.1% for houses and 0.9% for apartments. Weekly median rents are currently achieving $645 for houses and $555 for apartments. Greater Sydney total vacancy was last recorded at 1.9% in July 2016; with similar results in the inner ring (0-10km), the middle ring (10-25km) and outer ring (25km+). In July 2016, gross rental yields across Greater Sydney compressed 31 bps (to 3.1) for houses and 21 bps (to 4.1) for apartments compared to the previous year. Value Sydney Houses 1,057, , Sydney Apartments 703, ,

5 AUSTRALIAN RESIDENTIAL REVIEW SEPTEMBER 2016 RESEARCH State Product in Victoria was recorded at $355,580 million in the year to June 2015; 2.5% greater than stood at 5. for Greater Melbourne (SA4), trending 134 bps lower than the 6.7% recorded in July Population in Greater Melbourne was estimated at 4.5 million persons in Greater Melbourne experienced population growth of 2.1% in the year to June commitments in Victoria in the three months to July 2016 grew by 14. on the previous year, to $16.8 billion. to July totalled 6,907 houses and 8,248 apartments in Greater Melbourne. This is trending 12.5% higher for houses but 2. lower for apartment approvals compared to the same period in % out of 748 scheduled auctions in Greater Melbourne. This is higher than the week prior, at 77. from 1,060 scheduled auctions, and also higher than the comparable week the year earlier, when 77% (out of 1,158 scheduled auctions) were sold. tallied 57,417 houses (up 18. on previous year) and 40,878 apartments, Greater Melbourne 1 1 Rents & Total Vacancy Greater Melbourne s & Monthly Vacancy $480 $460 $440 $420 $380 $360 (up 3. on the prior year). 3.5% % % % 0. VACANCY House values declined by 0.1% in the month of July (growth of 8.7% over the last year) to a median of $742,500, while apartment values fell 1.5% over the month (growth of 2. over the year) to record a median of $499,000. fell by 1.1% for houses but rose 2.5% for apartments. Weekly median rents are currently achieving $450 for houses and $415 for apartments. 1 1 Six-month average total vacancy trend was recorded at 2. in July 2016 for Greater Melbourne; with 2.3% in the inner ring (0-10km), 3. in the middle ring (10-20km) and 2.5% in the outer ring (20km+). In July 2016, gross rental yields across Greater Melbourne compressed 30 bps (to 3.1) for houses and 3 bps (to 4.33%) for apartments compared to the previous year. Value Melbourne Houses 742, , Melbourne Apartments 499, ,

6 State Product in Queensland was recorded at $300,270 million in the year to June 2015; 0.5% greater than stood at 4. for Greater Brisbane (SA4), trending 106 bps lower than the 5. recorded in July Population in Greater Brisbane was estimated at 2.3 million persons in Greater Brisbane experienced population growth of 1. in the year to June commitments in Queensland in the three months to July 2016 grew by 9.1% on the previous year, to $10.4 billion. to July totalled 3,131 houses and 3,631 apartments in Greater Brisbane. This is trending 6.5% higher for houses but 34.7% lower for apartment approvals compared to the same period in out of 77 scheduled auctions in Greater Brisbane. This is higher than the week prior, at 44.3% from 129 scheduled auctions, and also higher than the comparable week the year earlier, when 58. (out of 158 scheduled auctions) were sold. tallied 44,027 houses (up 9. on, Greater Brisbane 7% 5% 3% 1% Rents & Total Vacancy Greater Brisbane s & Quarterly Vacancy $480 $460 $440 $420 $380 $360 $340 $320 $ % % % % 0. VACANCY previous year) and 21,091 apartments (up 5.5% on prior year). House values declined 1.5% in the month of July (with growth of 2.9% over the last year) to a median of $501,500 while apartment values rose 0. over the month (with growth of 3.9% over the year) to record a median of $388,000. grew by 1.1% for houses and rose 1.3% for apartments. Weekly median rents are currently achieving $455 for houses and $385 for apartments. Total vacancy was last recorded at 2. in June 2016 for Greater Brisbane; with 3. for the inner ring (0-5km) and 2.3% for the middle-outer ring (5-20km). In July 2016, gross rental yields across Greater Brisbane compressed 12 bps (to 4.73%) for houses and 12 bps (to 5.2) for apartments compared to the previous year. Value Brisbane Houses 501, , Brisbane Apartments 388, ,

7 AUSTRALIAN RESIDENTIAL REVIEW SEPTEMBER 2016 RESEARCH State Product in Western Australia was recorded at $276,312 million in the year to June 2015; 3.5% greater than stood at 7.3% for Greater Perth (SA4), trending 77 bps higher than the 6. recorded in July Population in Greater Perth was estimated at 2.0 million persons in Greater Perth experienced population growth of 1. in the year to June commitments in Western Australia in the three months to July 2016 fell by 10.7% on the previous year, to $6.2 billion. to July totalled 3,223 houses and 1,429 apartments in Greater Perth. This is trending 32. lower for houses and 36.7% lower for apartment approvals compared to the same period in % out of 6 scheduled auctions in Greater Perth. This is lower than the week prior, at 34. from 29 scheduled auctions, and lower than the comparable week the year earlier, when 66.7% were sold., Greater Perth Rents & Total Vacancy Greater Perth s & Quarterly Vacancy $550 $500 $450 $350 $ VACANCY tallied 22,902 houses (down 9.3% on previous year) and 10,008 apartments (down 10. on prior year). House values were recorded at a median of $502,500, falling 0. in the month of July and 3. over the last year. Apartment values fell 0.9% over the month, down 6.3% over the year, to record a median of $424,000. was down 5.7% for houses and 4.9% for apartments. Weekly median rents are currently $415 for houses and $385 for apartments Across the Greater Perth area, total vacancy was recorded at 6. in June 2016; remaining stable over the past six months. -1 In July 2016, gross rental yields across Greater Perth compressed 15 bps (to 4.29%) for houses but was up 5 bps (to 4.7) for apartments compared to the previous year. Value Perth Houses 502, , Perth Apartments 424, ,

8 State Product in South Australia was recorded at $98,539 million in the year to June 2015; 1. greater than stood at 7. for Greater Adelaide (SA4), trending 103 bps lower than the 8. recorded in July Population in Greater Adelaide was estimated at 1.3 million persons in Greater Adelaide experienced population growth of 0.9% in the year to June commitments in South Australia in the three months to July 2016 grew by 17. on the previous year, to $3.4 billion. to July totalled 1,640 houses and 965 apartments approved in Greater Adelaide. This is trending 11. higher for houses and 52. higher for apartment approvals compared to the same period in % out of 57 scheduled auctions in Greater Adelaide. This is greater than the week prior, at 63.3% from 83 scheduled auctions, and higher than the comparable week the year earlier, when 64. (out of 100 scheduled auctions) were sold. Rents, Greater Adelaide s $410 $390 $370 $350 $330 $310 $290 $270 $250, Greater Adelaide 5% 3% 1% -1% tallied 21,552 houses (up 12.3% on previous year) and 5,389 apartments (up 3.1% on prior year). House values were up 0.3% in the month of July (rising by 3.9% over the last year) to a median of $444,000. Apartments rose 2. in the month (up 2.9% over the year) to record a median of $324,000. rose 1.3% for houses and 1. for apartments. Weekly median rents are currently achieving $380 for houses and $310 for apartments. - In July 2016, gross rental yields across Greater Adelaide compressed 11 bps (to 4.45%) for houses and 8 bp (to 5.01%) for apartments compared to the previous year. Value Adelaide Houses 444, , Adelaide Apartments 324, ,

9 AUSTRALIAN RESIDENTIAL REVIEW SEPTEMBER 2016 RESEARCH State Product in the ACT was recorded at $34,866 million in the year to June 2015; 1. greater than stood at 2. for the ACT, trending 77 bps lower than the 3. recorded in July Population in the ACT was estimated at 391,000 persons in The ACT experienced population growth of 1. in the year to June commitments in the Australian Territory (ACT) in the three months to July 2016 grew by 19.9% on the previous year, to $1.2 billion. to July totalled 420 houses and 1,011 apartments in the ACT. This is trending 34. higher for houses and 19.9% higher for apartment approvals compared to the same period in out of 76 scheduled auctions in Canberra. This is higher than the week prior, at 71. from 61 scheduled auctions, and higher than the comparable week the year earlier, when 61.9% were sold. tallied 4,726 houses (up 6. on, Canberra Rents & Total Vacancy Canberra s & Quarterly Vacancy $550 $525 $500 $475 $450 $425 $375 $350 previous year) and 3,168 apartments (down 4. on prior year) % % % % % 0. VACANCY House values fell 0. in the month of July (with growth of 4.7% over the last year) to a median of $584,500. Apartment values fell 1.5% over the month (down 0.7% over the year) to record a median of $401,000. grew by 2. for houses and 1. for apartments. Weekly median rents are currently achieving $510 for houses and $410 for apartments. Total vacancy in Canberra was last recorded at 1. in March 2016; down 100 bps on the previous quarter and 150 bps lower compared to the prior year. In July 2016, gross rental yields across Canberra compressed 12 bps (to 4.57%) for houses and grew by 21 bps (to 5.3) for apartments compared to the previous year. Value Canberra Houses 584, , Canberra Apartments 401, ,

10 State Product in Tasmania was recorded at $25,419 million in the year to June 2015; 1. greater than stood at 5. for Greater Hobart (SA4), trending 32 bps higher than the 5.7% recorded in July Population in Greater Hobart was estimated at 221,000 persons in Greater Hobart experienced population growth of 0. in the year to June commitments in Tasmania in the three months to July 2016 grew by 15.7% on the previous year, to $697.2 million. to July totalled 203 houses and 36 apartments in Greater Hobart. This is trending 20.7% lower for houses and 5.3% lower for apartment approvals compared to the same period in out of 7 scheduled auctions in Greater Hobart. This was lower than the previous week when 66.7% of 3 scheduled auctioned were sold. tallied 2,762 houses (down 1.3% on previous year) and 950 apartments (down 2. on prior year). Rents & Total Vacancy Greater Hobart s & Quarterly Vacancy $450 $350 $300 $250 $ % % % % % 0. VACANCY, Greater Hobart House values fell 0. in the month of July (rising 6. over the last year) to a median of $388,000. Apartments fell 1. over the month (down 4. over the year) to record a median of $269,500. rose 8. for houses but fell 1.7% for apartments. Weekly median rents are currently achieving $380 for houses and $295 for apartments. Greater Hobart total vacancy was last recorded at 2.7% in March 2016; down 40 bps on the previous quarter and down 20 bps compared to the prior year. - In July 2016, gross rental yields across Greater Hobart compressed 10 bp for houses (to 5.09%) and rose 17 bps for apartments (to 5.6) compared to the previous year. Value Hobart Houses 388, , Hobart Apartments 269,

11 AUSTRALIAN RESIDENTIAL REVIEW SEPTEMBER 2016 RESEARCH State Product in the Northern Territory was recorded at $22,450 million in the year to June 2015; 10.5% greater than Unemployment stood at 3. in Greater Darwin as at July 2016, trending 20 bps lower than the 4. recorded in July Population in Greater Darwin was estimated at 142,000 persons in Greater Darwin experienced population growth of 1.9% in the year to June commitments in the Northern Territory in the three months to July 2016 fell by 11. on the previous year, to $305.6 million. to July totalled 154 houses and 203 apartments in Greater Darwin. This is trending 41. lower for houses and 1.9% lower for apartment approvals compared to the same period in out of 6 scheduled auctions in Greater Darwin. This was lower than the previous week when 6 of 13 scheduled auctioned were sold. tallied 1,069 houses (down 14.1% on previous year) and 491 apartments (also down 10. on prior year). Rents & Total Vacancy Greater Darwin s & Quarterly Vacancy $650 $600 $550 $500 $450 $350 $ VACANCY, Greater Darwin House values fell 1.3% in the month of July (down 6. over the last year) to a median of $526,500. Apartments remained steady over the month (down 5.7% over the year) to record a median of $381,500. was down 6.9% for houses and 5. for apartments. Weekly median rents are currently achieving $540 for houses and $425 for apartments. Greater Darwin total vacancy was last recorded at 8.7% in March 2016; down 20 bps on the previous quarter however 230 bps higher compared to In July 2016, gross rental yields across Greater Darwin compressed 5 bps (to 5.35%) for houses and 2 bps (to 5.8) for apartments compared to the previous year. Value Darwin Houses 526, , Darwin Apartments 381,

12 RESIDENTIAL RESEARCH Michelle Ciesielski Director Michelle.Ciesielski@au.knightfrank.com Matt Whitby Group Director Head of Research and Consultancy Matt.Whitby@au.knightfrank.com RESIDENTIAL AND PROJECT MARKETING Michael Robinson Head of Project Marketing, Australia Michael.Robinson@au.knightfrank.com Neil Kay Senior Director Head of Residential, Perth (WA) Neil.Kay@au.knightfrank.com Sam Kandil Head of Project Marketing, Sydney (NSW) Sam.Kandil@au.knightfrank.com Daniel Cashen Director, Melbourne (Vic) Daniel.Cashen@au.knightfrank.com Chris Litfin Head of Project Marketing (Qld) & Gold Coast Chris.Litfin@au.knightfrank.com Gillian Bail Director, Brisbane (Qld) Gillian.Bail@au.knightfrank.com INTERNATIONAL PROJECT MARKETING Rebecca Pugh Manager, Australia Rebecca.Pugh@au.knightfrank.com First Home Buyer Incentives Guide September 2016 Taxing Foreign Investors in Australia July 2016 Global House Price Index Q Knight Frank Research Reports are available at KnightFrank.com.au/Research The Wealth Report 2016 Important Notice Knight Frank Australia Pty Ltd 2016 This report is published for general information only and not to be relied upon in any way. Although high standards have been used in the preparation of the information, analysis, views and projections presented in this report, no responsibility or liability whatsoever can be accepted by Knight Frank Australia Pty Ltd for any loss or damage resultant from any use of, reliance on or reference to the contents of this document. As a general report, this material does not necessarily represent the view of Knight Frank Australia Pty Ltd in relation to particular properties or projects. Reproduction of this report in whole or in part is not allowed without prior written approval of Knight Frank Australia Pty Ltd to the form and content within which it appears. Knight Frank Research provides strategic advice, consultancy services and forecasting to a wide range of clients worldwide including developers, investors, funding organisations, corporate institutions and the public sector. All our clients recognise the need for expert independent advice customised to their specific needs.