REA Group Property Demand Index

Transcription

1 Introduction REA Group Property Demand Index Let s be honest, housing is no longer affordable Nerida Conisbee REA Group Chief Economist FEBRUARY 2017 FOR MORE INFORMATION: Phil Mahoney, Media Relations Manager phil.mahoney@rea-group.com Housing unaffordability is generating continuing public debate across the country, but it s time to admit we re likely heading straight towards a housing affordability crisis in our two largest cities unless s omething changes. Demand levels on realestate.com.au continue to surge in Sydney and Melbourne, while house median prices continue to break records on the Eastern seaboard. Melbourne is better placed to weather the storm for longer, but Sydney, hampered by long-term underdevelopment, needs action. The only long term solution to the city s affordability problem is to increase the supply of housing. There are a number of things that need to be done to improve this. This includes amalgamation of councils to improve planning systems and changes to NSW strata laws. Better relationships between state government and developers should be a priority, in order to partner investment in public infrastructure such as roads, schools and shops with new developments. This has led to a lot of success in Melbourne which despite being an expensive city, is far more affordable than Sydney. Sydney's lack of affordability is an economic issue. If it s too expensive to live in the city, people will begin to move to more affordable regions and cities. The first to move will be those in essential services, such as nurses, doctors, teachers, pharmacists, plumbers, police, who don t necessarily need to live in a large expensive city to secure work. Any changes to bank lending rates this month will determine demand levels for February. The Reserve Bank of Australia is expected to keep rates stable, or even decrease them this month, however there is no guarantee that banks will follow suit. Conditions remain highly challenged in Western Australia and Northern Territory where demand continues to fall, while Tasmania remains a stand out, continuing to perform above expectation. High levels of apartment development across the country are leading to demand levels increasing at a slower pace than housing and, despite very high demand for housing in the major Victoria and New South Wales markets, demand for apartments is stabilising in both states.

2 Data & Insights Monthly Index Values 31 JANUARY 2017 City All Dwellings Houses Units Month End Value YOY MOM Month End Value YOY MOM Month End Value YOY MOM AUS % 4.5% % 12.9% % 0.9% WA % -4.9% % -4.8% % -6.2% ACT % 19.7% % 27.6% % 14.6% NSW % 7.3% % 8.3% % -0.5% NT % -6.5% % -6.4% % -6.8% QLD % 4.8% % 5.1% % 4.4% SA % 2.3% % 3.7% % -3.1% TAS % 51.7% % 16.2% % 22.7% VIC % 4.3% % 6.3% % 0.1%

3 All Dwellings: National All Dwellings: States January 2017

4 Houses: National Houses: States Janaury 2017

5 Apartments: National Apartments: States January 2017

6 The REA Group Property Demand Index is produced by the REA Group, owner and operator of realestate.com.au the leading source in Australia for residential property with a total average unique audience of more than 5.9 million (Nielsen Digital Ratings (Monthly), June-November 2016). The REA Group Property Demand Index provides data and insights relating to demand for residential dwellings across Australia, at a national level and per state and territory according to site visit data on realestate.com.au. It calculates the number of online visits in the past month (including at least one interaction with a property) against the average number of property listings. This metric is seasonally adjusted to negate the effect of spikes in any given month, and it is indexed to a point in time (February 2013). This report details the key findings of the REA Group Property Demand Index for January This report uses REA Group internal data that is current as at the time of publication. This report provides general information only and is not intended to constitute any advice or appraisal and should not be relied upon as doing so. If you wish to cite or refer to this report (or any findings or data contained in it) in any publication, please refer to the report as the REA Group Property Demand Index (Jan. 2017).