Australian Property

The Housing Industry Association (HIA) has released new home sales data for October, with sales collapsing another 28% month-on-month.

Earlier this week I presented the Department of Home Affair’s latest temporary visa data, which showed that the number of temporary visa holders in Australia swelled to 2,146,000 over the September quarter, up 503,000 year-on-year: Moreover, the number of temporary visa holders were now just a fraction below the 2018 peak.

In last month’s federal budget, Treasurer Jim Chalmers announced a “new housing accord” that would aspire to “build one million new, well located homes over five years from 2024”.

Goldman Sach’s Australian chief economist, Andrew Boak, has forecast that the Reserve Bank of Australia (RBA) will lift the official cash rate (OCR) another five times over the next six months, taking the OCR to a peak of 4.10% by May 2023.

Yellow Brick Home Loans Executive Chairman Mark Bouris is “very worried” the Reserve Bank of Australia’s (RBA) aggressive rate hikes will break mortgage holders and the housing market.

CoreLogic’s latest housing market summary shows that Australia’s rental market continues to deteriorate, with vacancies and listings hitting fresh lows, and rents continuing to soar at double-digit rates.

AMP Capital chief economist Shane Oliver last week posted the below chart on Twitter showing how the “2012 and 2019 housing upswings did not start until rates fell”, which he believes is still some time off: Oliver’s observation is also intuitive, given rising/falling interest (mortgage) rates decrease/increase borrowing capacity and ergo buyer demand.

Modelling from the Parliamentary Budget Office (PBO) forecasts that negative gearing costs are likely to double as interest rates rise and could potentially triple over the next decade.

Australian Transaction Reports & Analysis Centre CEO Nicole Rose says Australia’s money laundering laws (AML) need to be expanded to cover ‘gatekeepers’ such as real estate agents and accountants.

Sydney-based buyer’s agent, Jack Henderson, has warned that there has been a marked increase in distressed property sales, especially amongst first home buyers that purchased near the top of the market last year.

The Australian Bureau of Statistics (ABS) released population data showing that Australia’s capital cities expanded by 2,516,103 people in the decade to 2021, led by the migrant epicentres of Melbourne (+806,791 people) and Sydney (+650,815 people): A ‘lack of housing supply’ is often blamed for Australia’s housing affordability woes.

The thing is, Australia has a very basic economic model.