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Capital city home values in Australia up 3.3% in first four months of 2016
Home values in Australian capital cities continued to rise in the first four months of 2016, up 3.3% compared to the same period in 2015, the latest index shows. In April, the pace of capital gains rebounded from the relatively flat numbers recorded in March, with dwelling values increasing by an average of 1.7%, according to the Corelogic April home value index. Across the country, housing market trends remain mixed, however, and CoreLogic research director Tim Lawless noted that the improvement in the rate of capital gains has been ‘broad based’ during 2016 with every capital city except Perth recording a lift in dwelling values over the calendar year to date. ‘The results show value growth moved at a faster pace compared with the final three months of 2015 when capital city dwelling values slid 1.4% lower off the back of weaker market conditions in Sydney and Melbourne,’ he explained. ‘While we’ve seen capital gains moderate substantially after peaking last year in Sydney and Melbourne, dwelling values continue to trend higher, just not as fast,’ he added. The data shows that the annual rate of growth in Sydney peaked at 18.4% in July last year and has since moderated back to slightly less than half the peak rate of growth, at 8.9% over the most recent 12 month period. Melbourne’s housing market continues to show a level of resilience to a slowing trend, however the annual growth rate has fallen from a recent peak of 14.2% to the current annual growth rate of 10.1% but Melbourne was the only capital city to see double digit growth over the past year. Perth and Darwin remain as the only two capital city markets to experience a decline in home values over the past 12 months, with Perth values down 2.1% and Darwin values 3.7% lower. ‘With recent month on month increases in home values in these two cities, the declining trend rate is now levelling. This may be an early sign that these markets are beginning to find their cyclical trough after more than a year of annual declines,’ said Lawless. Over the current growth cycle, which commenced broadly in June 2012, capital city dwelling values have moved 34.4% higher, led by a 52.7% rise in Sydney home values and a 37.1% lift in Melbourne values. Lawless pointed out that this highlights the two tiered nature of Australia’s housing market at present. Brisbane experienced the third highest rate of dwelling value growth over the growth cycle to date and dwelling values in the city are now up 18% and Lawless explained that Australia’s regional markets also exhibited a lift in house values over the year to date. He added that while house values across the non-capital city markets have generally underperformed compared with the capital city regions, regional house values moved 2.4% higher over the first quarter of the year. Continue reading
Home owner confidence in UK housing market up 4% year on year
UK home owners’ confidence home owners in the property market has risen 4% year on year with expectations that prices will rise by more than 7% in the coming six months, new research shows. Some 92% are anticipating prices in their area to rise within the next six months, a steady increase from a year ago when only 88% were confident, according to the latest Zoopla Housing Market Sentiment Survey. The research also found that almost half of home owners, 41%, were planning to improve their property. In addition, 9% of respondents said they plan to refinance their house, a 3% increase from the end of 2014, as mortgage rates remain at historical lows. The proportion of respondents planning to sell property has risen to 19% having bottomed out at 15% last year as more home owners look to capitalise on rising prices. The East of England has the highest percentage of optimistic home owners, with 97% expecting the price of property in their area to rise over the next six months. Home owners in London and the South East are almost as confident, with 96% of respondents across those regions expecting price appreciation. Despite home owner confidence around house prices, sentiment around the accessibility of funding is more volatile. While the percentage of respondents declaring it harder to get a mortgage now than three months ago has almost halved from 49% to 26% since the Mortgage Market Review (MMR) was introduced in April 2014, the fact that more than a quarter of homeowners have noticed a recent increase in difficulty suggests that it isn’t all plain sailing, the report says. It also suggests that with ongoing speculation around when the Bank of England will raise interest rates and lenders maintaining a watching brief, it may well be that competitive products aren’t quite as freely available as they were in the earlier part of the summer and borrowers previously spoilt for choice are noticing the change. ‘As the end of the year approaches, homeowners are the most optimistic they have been in some time. With the brightening national economic outlook this bodes well for the property market in 2016,’ said Lawrence Hall of Zoopla. ‘While traditionally the estate agency market tends to take a break over Christmas in terms of completions and viewings, home owner confidence shows no sign of slowing down and many individuals use the end of the year as a landmark to evaluate how much their property has appreciated over the calendar year,’ he explained. ‘The only slight chink in the armour is the fact that a sizeable number of people still feel securing a mortgage is becoming more difficult, despite the fact that the MMR was implemented with consumers’ best interests at heart,’ he pointed out. ‘It could also be an indication that the supply of… Continue reading
City property values in Australia decreased gradually during 2014, latest index shows
Residential property values in Australian capital cities increased by 0.9% in December to take the annual increase to 7.9%, the latest index data shows. Values rose in all cities except for Darwin where they fell by 0.6% and Canberra where they were also down by 0.6% while values were unchanged in Sydney, according to the CoreLogic RP Data Home Value Index. Over the final quarter of 2014, capital city home values increased by 1.6% with Perth, Sydney and Brisbane recording the greatest quarterly gains at 2.8%, 2.3% and 1.8% respectively, while values fell in Darwin by 1.7% and in Canberra by 3.4%. However, despite the positive result across most cities, the annual rate of capital gain across Australia’s capital city housing market has continued to slow. The capital gain on houses compared to units was higher, with house values gaining 8.4% over the calendar year compared with a 5.1% increase in unit values. According to RP Data senior research analyst Cameron Kusher, detached housing remains in high demand despite the higher price point. ‘Based on the median price across the combined capital cities, houses are attracting a $100,000 premium over apartments,’ he said. He also pointed out that the slowing annual growth rate is further evidence that the housing market is losing some steam with combined capital city home values increasing by 9.8% over the 2013 calendar year compared to a more moderate 7.9% increase in 2014. Based on the December results, the annual rate of capital growth has continued its moderation which has been ongoing since April 2014. After the annual rate of combined capital city home value growth peaked at 11.5% over the 12 months to April 2014, the rate has now slowed to 7.9% in December 2014 which means that combined capital city home values have increased at their slowest annual pace since October 2013. At an individual capital city level, the annual rate of home value growth is now lower than its recent peak. Kusher said this would tend to suggest that peak value growth has now passed. ‘We would anticipate that the rate of growth will continue to slow through 2015 despite the low interest rate environment,’ he explained. Although home value growth has been recorded at 7.9% throughout the 2014 calendar year, the rate of growth has varied between a fall of 0.6% in Canberra to an increase of 12.4% in Sydney. While Canberra was the only city to record an annual fall in home values, Melbourne was the only city other than Sydney to have recorded annual value growth of more than 5% at 7.6%. Looking at the different segments of the market based on dwelling values, the broad middle 50% of capital city suburbs have recorded the greatest value rise over the past year. The most affordable 25% of capital city suburbs have recorded a gain of 7.7% compared to 8.5% across the middle 50% of suburbs and 7.8% across the most expensive 25%. The index… Continue reading
