JUNE MARKET REPORT.. WHAT HAPPENED COMING UP TO THE EOFY?

Our June Results

 

The sign savvy home buyers and investors have been waiting for is on the horizon after a rocky  12-months in property. Most Australian capital cities reported a downturn in home values last year,  however recent industry data shows the rate of decline is losing momentum.

According to CoreLogic data, national dwelling values for the quarter to May 2019 were down 1.5  per cent, however a closer look at individual cities such as Sydney and Brisbane, shows more specific  movement.

Brisbane home values were down 1.4 per cent by the end of the quarter and down 2.3 per cent for  the year to May 2019. Overall, Brisbane’s combined unit and house values remains 2.4 per cent  lower than the April 2018 peak.

The good news for current Brisbane house hunters and investors is that house values are expected  to see a correction this year according to the CoreLogic-Moody’s Analytics June quarter Housing  Forecast Report. The analysis showed that house prices should be bouncing back in 2019 with  apartment prices predicted to experience a mild price correction over the same period. With the  worst of the downward trend behind it, Brisbane’s apartment market is ripe for investors and is  tipped to transition by 2020 with a projected 5.6 per cent price rise.

CoreLogic’s head of research  Tim Lawless recently described Brisbane’s once-troubled apartment market as “starting to look  healthier”.

Another positive sign for Brisbane investors is that despite slow rental growth for the quarter, it is  nevertheless up 1.5 per cent across all dwellings with a gross rental yield of 4.6 per cent.  Buyers are also in the driver’s seat with Brisbane’s time on market pushing out from an average of  36 days in May 2018 to 55 days by May 2019.

Sydney purchasers have been holding out for a plateau in property prices and while dwelling values  still fell in the quarter to May 2019 by 2 per cent, the drop was less severe than preceding quarters.  Over the 12-months to May, Sydney values dropped by 10.7 per cent with CoreLogic’s figures  showing property prices are now 14.9 per cent lower than their peak in July 2017. Of Sydney, Mr  Lawless recently said; “it looks like the bottom of the cycle is just around the corner”.

The CoreLogic-Moody’s Analytics report showed that after dropping 5.5 per cent in 2018, and with  further declines in 2019, Sydney’s house values are forecast to begin a slow recovery in 2020.  Apartment values could decline further this year, but are expected to increase by as much as 4 per  cent by 2020.

While there has been no rental growth in Sydney, with combine dwelling asking rents down 2.9 per  cent in 12 month, the radical drop in rents that had been predicted at the start of the year has not  eventuated. Twelve-month yields are sitting at 3.5 per cent.

Another positive for Sydney buyers is that the average days on market has shifted from 33 days in  May 2018 to 50 by the end of May 2019 giving them more negotiating power.

For more on market trends and activity please reach out to us on 1300 420 160 or email: [email protected]

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