Category: Home Prices

Property Buyers’ Plans Destroyed By “Higher For Longer” Rate Trends!

The combination of high prices and interest rates is seeing affordability become extremely stretched at a time when cost-of-living pressures more generally are also constraining incomes, according to a recent Westpac Survey.

In response, would-be buyers are pushing the timing of their planned purchases back – less than 10% expect to transact in the next 6mths, the lowest share across all survey waves.

The prospective flow of first home buyers is showing the biggest response to these pressures, planned purchases down materially on last year. Just 2% of those surveyed expecting to become a first time owner in the next year.

Outside of the first home buyer space the story looks to relate more to the interest rate situation. Prospective investor buyers have pared back plans for the next six months.

And sales results for this weekend confirms the slowing market, despite some properties still exceeding reserves in some places. As reported in the AFR, the prospect of interest rates staying high has spooked many buyers, making them less likely to spend above their budgets.

http://www.martinnorth.com/

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Today’s post is brought to you by Ribbon Property Consultants.

Its Edwin’s Monday Evening Property Rant!

Another deep dive into property and politics with our Property Insider Edwin Almeida, as we look at the latest spin on affordability and “hot suburbs”.

The drive towards high-rise density has consequences, but even the quality of low-rise is a concern. Meantime, listings are still in the doldrums, while rental availability is largely shot.

And recent DFA coverage stirred up the Chatterers….

http://www.martinnorth.com/

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Today’s post is brought to you by Ribbon Property Consultants.

Government Housing Targets An Impossible Dream As Building Approvals Shrink!

The ABS released data on the total number of dwellings approved in February recently. They say that despite growth in private houses in the month, the total number of dwellings approved fell 1.9 per cent in February (seasonally adjusted), after a 2.5 per cent fall in January. The trend estimate for total dwellings approved fell 3.0%, following a 2.7% January decrease.
Specifically, approvals for private sector dwellings excluding houses fell 24.9 per cent in February in seasonally adjusted terms, driven by a fall in the number of approved large apartment projects. In contrast, approvals for private houses rose 10.7 per cent in February.

This continues to confirm the massive gap between the Government aspiration of 1.2 million new homes over the next 5 years. On a straight-line basis, this translates to a target of 240,000 each year – which by the way is still way under the number needed to house the surging migrants and fill existing shortfalls.

So why not tackle the root cause issue here, too high migration? Entrepreneur Dick Smith fears today’s young people will have no savings and be forced to live in Chinese-style high-rise apartments unless immigration is urgently slashed, according to an article in the Daily Mail.

The veteran businessman and philanthropist says they need to understand the connection between a surging population and climate change. The entrepreneur, who turned 80 last month, fears homes with a backyard in Australia’s capital cities will no longer exist by 2050.

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Today’s post is brought to you by Ribbon Property Consultants.

It’s Another Fine Mess… With Tarric Brooker!

Our latest Friday Afternoon chat with journalist Tarric Brooker as we look at the current data, which questions potential rate cuts, and housing trends, as demand stays strong while supply is limited.

Below the water line we examine some of the underlying assumptions behind the numbers, and how politics have changed.

Worse, the structural issues can be traced back to a series of political decisions, which were policy errors – when will they come clean?

Tarric’s charts are here: https://avidcom.substack.com/p/dfa-chart-pack-12th-april-2024 if you want to follow along.

http://www.martinnorth.com/

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Tenants Caught In The Python-Like Property Squeeze Have To Pay More!

Domain has released its Rental Report for March, which delivered more bad news for tenants, on top of the data I released recently which showed three quarters of those renting already have cash-flow issues. Younger families and first-generation Australians are being hit really hard, but as I discussed in my live show, other household categories are also being caught in the rental squeeze. And despite the rise in rents, some investors are selling due to poor net returns.

With net overseas migration forecast to remain historically high, albeit lower than last year, Australia’s rental crisis will continue, even if vacancy rates and rental inflation ease a little.

As a result, more Australians will be plunged into rental stress, group housing, or homelessness.

The solution is to cut net overseas migration hard to a level well below the nation’s capacity to build homes and infrastructure.

The other factor no one is talking about is that renters under extreme pressure are being coerced into buying property, even if its poor quality or in the wrong area, just to exit the rental sector and try to get some control. With borrowing power down about 40-50%, these households are leveraging up, as see by the larger loan balances against income. But this could be an issue of jumping from the frying pan into the fire!

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Today’s post is brought to you by Ribbon Property Consultants.

Its Edwin’s Monday Evening Property Rant!

More insights from our property insider, as we look at the issue of supply and migration, plus the impact of the recent flooding rains, and also the latest on listings and prices.

How broken in the market at the moment, and how are agents playing psychological games with prospective purchasers?

http://www.martinnorth.com/

Go to the Walk The World Universe at https://walktheworld.com.au/

Today’s post is brought to you by Ribbon Property Consultants.

If you are buying your home in Sydney’s contentious market, you do not need to stand alone. This is the time you need to have Edwin from Ribbon Property Consultants standing along side you.

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Edwin understands your needs. So why not engage a licensed professional to stand alongside you. With RPC you know you have: experience, knowledge, and master negotiators, looking after your best interest.

Shoot Ribbon an email on info@ribbonproperty.com.au & use promo code: DFA-WTW/MARTIN to receive your 10% DISCOUNT OFFER.

Another Fine Mess For Australian Housing!

Wherever you look, the news is not good for those wishing to see housing affordability relief.

First demand for rentals continues to be powered by the overseas influx. New data from the Department of Home Affairs shows that at the end of February, the number of international students in Australia hit a record high of 713,144, whereas the number of temporary migrants in Australia hit a record high of 2.8 million (nearly 2.4 million excluding visitors).

Or put it another way, the number of student visa holders in Australia is running around 80,000 above the pre-pandemic peak, while the number of temporary visa holders excluding visitors is around 400,000 above the pre-pandemic peak.

Then we can turn to the question of new housing supply. I have covered before the fact that the country is littered with half-completed construction projects, many of which are competing for labour and resources with the large number of government and commercial projects also currently running. This crowded out home builders as the major projects sucked in labour and drove up its cost.

But we also continue to see more building firms going under. In the light of this, perhaps we should not be surprised that the total number of dwellings approved fell 1.9 per cent in February (seasonally adjusted), after a 2.5 per cent fall in January, according to data released on Thursday by the Australian Bureau of Statistics (ABS).

http://www.martinnorth.com/

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Today’s post is brought to you by Ribbon Property Consultants.

Its Edwin’s Monday Evening Property Rant!

More from our Property Insider, Edwin Almeida, as we look at the latest property news, and also discuss dummy bidding, and how changes in China are impacting property here.

http://www.martinnorth.com/

Go to the Walk The World Universe at https://walktheworld.com.au/

Today’s post is brought to you by Ribbon Property Consultants.

DFA Live Q&A HD Replay: Fixing Housing After The Hijack: With Cameron Murray

This is an edited version of a live discussion with Cameron K. Murray, Author of The Great Housing Hijack which reveals how vested interests pull the strings on the property market in Australia, and offers a solution for genuinely affordable housing for those who need it.

With 120,000 people homeless each night and one in five low-income private renters spending more than half their income on rent, it is clear Australia urgently needs a housing policy change.

For anyone who wants to truly understand the housing market in Australia, The Great Housing Hijack is essential reading. Drawing on the best housing policies around the world, Murray shows how Australia could create a genuinely affordable housing program without compromising the interests of existing property owners.

Murray argues that even if more housing were built, the average household would not end up spending any less on housing.

Murray proposes bypassing the private market altogether with a scheme called HouseMate. The federal government would buy or repurpose land, build homes, then sell them at a discounted price to Australians who do not own property.

Perhaps the most controversial argument in The Great Housing Hijack is that planning and zoning rules do not change how much new housing is built, just the location.

Join the debate – you can ask a question live.

https://www.fresheconomicthinking.com/

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The Aussie Housing Crisis Out To 2030 And Beyond? With Tarric Brooker…

Journalist Tarric Brooker and I deep dive on the Australian Housing Crisis, as conclude that there is no easy fix, thanks to generations of bad policy and active intervention. So who are the winners and losers?

Tarric slides are here if you want to follow along: https://avidcom.substack.com/p/dfa-chart-pack-22nd-march-2024

http://www.martinnorth.com/

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