The property market is on recovery mode but rise in median house prices or capital city value growth should not be made an occasion for celebration just yet. Michael Yardney for the Property Update mentions how the 2.2% growth in median housing prices this quarter is quite moderate and even below the last quarter’s performance by 0.3%.
The average capital city value growth is not a true reflection of the country’s property market either. It’s just that Sydney to a very large extent and Melbourne in a smaller capacity have overcompensated for the patchy performance of other capital cities; and hence the growth.
Consumer sentiment, though reported otherwise, is still sloppy and there is sparse growth in household income. Recent oversupply in Sydney may impact rental yield negatively but the capital city itself (along with Melbourne) should continue to do well.
You can read the original article here.
Do you think Sydney will beat Melbourne flat in terms of value growth over next few years?
A spectacular rate of auction clearances (“at auction” clearances) is just one trend that underpins how well the Sydney property market is doing. Add to this the fact that Sydney has topped the chart for “capital city value growth” and is showing promising figures for median household prices too. This implies that there will be rampant construction activity in Sydney in coming times.
Location is on the top of the minds of Australian property buyers. This is followed by availability of amenities. To put it differently, the condition of a property hardly holds centre-stage in the criteria a buyer sets for himself today. Brendan Wong for The Adviser asserts that “property condition” has lost its traditional dominance.
It’s quite a feeling when you get your opinion voiced from other quarters as well. Being a person who has long been vocal against the use of term “bust” and “boom”, I feel vindicated while reading Mark Armstrong’s piece on the Property Observer. He asserts that we are not at or near a phase of property boom and the present growth is part of the natural property cycle.
In a recent article on home values, Cameron Kusher shares a few interesting statistics regarding growth in capital city home values and the longevity of growth periods in an article for the Property Update.
The housing market has shown fine momentum and the market confidence amply reflects in the upward curve of the construction sector. Tim Lawless for the Property Update talks about the hike in dwelling construction and partly attributes it to the low mortgage rates. Development activity has picked up all across Australia and unlike the resource sector; investment in housing sector should keep posting good numbers in times to come.
