Money has never been so affordable with the Reserve Bank board deciding to leave the cash rate unchanged at 2.5% and RP Data research director Tim Lawless says they should stay that way with the low mortgage rate environment still not having an impact in some markets. He says house values across Brisbane have barely moved over the past year, while dwelling prices have softened in Adelaide and Hobart, and momentum has shrunk in Perth and Darwin.
Listing numbers fell in September. SQM Research report national stock levels decreased by 3.4%. Month on month, all capital cities recorded declines apart from Hobart, which had a slight increase. Sydney had the largest decrease in listings with a huge 17.6% fall in stock since September 2012. SQM’s Louis Christopher says he expects the level of online residential sales listings to lift in October and November.
Despite the fall in stock, there’s continued evidence we’re in a rising market. Westpac senior economist Matthew Hassan says the real estate upswing is gaining momentum, with a surge in auction activity and signs of accelerating price growth. National auction clearance rates over the September quarter were at 70%, with Sydney being the standout performer, recording a 78% clearance figure. Hassan says buyers shouldn’t be concerned about the much feared bubble. He says, “While activity has strengthened over the last three months, current conditions are still a world away from the booms that have seen overheating in the past.”
Finally first Homebuyers are setting ambitious goals for saving their deposits. According to the 2013 Mortgage Choice Future First Homebuyer Survey, while 83% of first homebuyers say they are prepared to sacrifice aspects of their lifestyle in order to get onto the property ladder, the majority only plan to save for an average of 1 to 2 years before buying. The study revealed that, despite rising property prices, one in four future first home buyers are still only saving an average of 10% of their monthly income after tax. According to the research, most future first home buyers would be willing to miss out on a holiday if it meant they could get on the property ladder sooner, while others would delay having children or move back in with parents or in-laws, which will no doubt have some empty-nesters sweating.