From SQM Research’s free weekly newsletter comes the below report on listings and vacancy rates in Australia’s resources towns. Note how vacancy rates and listings in mining towns have generally risen significantly over the past year, whereas agricultural-based towns are showing more stability. We should expect the situation in mining towns to deteriorate further as the once-in-a-century boom in mining investment and bulk commodity prices comes off the boil.
As promised last week, we thought we would publish some property data on the nation’s resources based towns by way of listings and vacancy rates.
As can be seen, there is a wide variety of results. That suggests to me a universal truth – housing markets are very dependent upon the underlying economic base of the locality. Other macro influences such as interest rates, aggregate GDP, etc are secondary influences. So for agricultural based towns, the respective housing markets appear to be stable and almost boring! Consider Cloncurry, Esperence and Grafton. Some mining related towns are also holding up ok based on SQM’s property data. Consider Ballarat, Beaconsfield and Katherine as examples.
However, there are plenty and plenty of towns which appear to be in trouble. Consider this, 71% of the mining/gas related towns surveyed had a vacancy rate over 3%. 66% of all the towns surveyed recorded a rise in vacancy rates year-on-year. While just 24% of agricultural/livestock related towns had a vacancy rate of greater than 3%.
I’ll let you speculate what this all means. And please, if you are interested, click here for to find the implied gross rental yield for your postcode and here to find the current asking price for both houses and units in your postcode.
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
