Hi, I'm Graham the Insights manager at finder.com.au and you know, the RBA didn't cut cash rates
today, it looked dicey leading up to the decision that maybe they would but in the end they
didn't. So we're waiting to see what the effects of the last two records are. The RBA seems
to think the economy's okay for now, here we're going to talk about four things to keep
an eye on in the Australian housing market for August 2019.
So what's happened to interest rates for home runs? Well, as you know, the RBA could buy
50 basis points. But the average code of the variable rates across the big four banks is
only 43. So they kept a little bit back for themselves. But having said that, those are
the big variable rates.There is good value to be had in the market. Aside from that,
we've seen rates as low as 2.75% for some lenders, and all of these lenders on the screen
here have sub 3% loans available right now. So there is value to be had for those who are willing to shop around.
Bear one thing in mind though, that rates can continue
to go down if you get a fixed rate. Next 60% of economist surveyed by Finder, were expecting
another rate cut. We asked them last week. Though the RBI statement after today's hold decision
makes it look like maybe we might not see another cut
So you know, it's definitely worth watching that space and bearing that in mind before
you lock in fixed, right.
So what's happening to house prices? Well,
last month, we saw three cities experience positive growth for the first time in quite
a while. This month, we've seen five do the same. So Sydney, Melbourne, Brisbane, Darwin
and Hobart, who all experienced positive growth. The numbers are there on the screen.
However, it's worth noting the prices declined in all other cities so prices fell in Perth,
Adelaide and Canberra, meaning the average growth across Australia is only 0.1%.
We asked our economists what they expect house prices to do over the next 12 months in the
Australian capitals. And when we look at the growth figures, Cambria, top the list oat 2.27%
followed by Hobart at 2.19% and Brisbane at 1.81%. These are moderate growth figures
But it does show that on average across the economist's opinions, some growth is expected.
So what's happening auctions? Well, I went to my first house viewing in
quite a while this weekend in Sydney, for a small two bedroom home and there was nearly
100 people there. There were queues down the street, it definitely felt like something
had changed in the market. But if we really want to know if that's the case, we need to
look at the auction clearance rates. Now these are the percentages of homes on the market
that are actually selling. And they've been relatively positive recently that as you'll see from the numbers on the screen,
they've slacked back a little bit in Sydney, and they've kind of stagnated in Melbourne.
So they werelooking a little bit better but now we're not really quite sure what's happening there.
So is this the recovery or are things looking
pretty gloomy? Well, there's a lot of people talking about a dead cat bounce in the media,
now a dead cat bounce is the last gasp for breath of dying asset when an economy generally is
going down the tubes. So we don't want that to be the case. But if we want to know whether
we're looking at a genuine recovery or a dead cat bounce, we need to look at figures a little
bit deeper. Now going back to those auction clearance rates. While the numbers look
relatively okay, we need to also look at the volume of houses for sale on the market.
Those percentages are coming from 320 auctions in Sydney across the last weekend, and 450 in
Melbourne. The thing is, if you look at the same figures for February this year, there
was around 700 auctions in Sydney and around 1000 auctions in Melbourne. So there's a lot
of reduced stock on the market. One of the reasons these clearance rates look pretty
high is that there's quite low volumes of property on the market. Separate data from
Core Logic says a 20% decline in the number of new properties on the market year on year,
but a hole in the overall number of properties Now what that means his properties are staying
on the market for longer, which means potential sellers are not getting the prices that they
want quickly. So these high numbers could just be an artificially inflated reflection
of the low volume of stuff in the market. So it might not be the true actual value of
homes, we really need to see those volume numbers go up as well as the house prices
go up to make a determination as to where we're going. However, lenders at the same
time are reporting increased number of inquiries and our website as an increased traffic to
the Home Loans inquiry pages. So that definitely appears to be more interest in the market
out there. We have to wait and see what about Peters into more buying action.
So our economists we have surveyed being all over optimistic? Are we heading for recovery?
Or are we in the middle of a continuing downturn? Let us know what you think in the comments below.
In the meantime, keep an eye on Finder.com.au for continuing news coverage of the economy in Australia.