Australian Property

By Leith van Onselen Fairfax’s Elizabeth Knight has pinned the blame for Australia’s housing mess squarely on the shoulders of the federal government and called on it to immediately implement negative gearing reforms: Who can fix Australia’s runaway house prices?..

Recall that the RBA recently caught up to MB with its study of housing shrinkflation: After rising for a number of years, the rate of housing turnover (that is, the number of transactions relative to the stock of housing) has trended lower since the early 2000s (Graph 1).

The Australian operates in bizarro world today: Australia’s growing dependence on borrowing to buy and build homes has prompted warnings the economy faces a serious shock, increasing the pressure on regulators to act carefully before further tightening the screws on the fragile property market.

By Leith van Onselen Coalition in-fighting over whether to cut the capital gains tax (CGT) discount in the upcoming Budget continues to fester, with Finance Minister Mathias Cormann still trying to suppress backbench pressure to reform the concession.

Prosper Australia has for years been conducting research into how many of Australia’s 9.8 million homes are left vacant.

By Martin North, cross-posted from the Digital Finance Analytics Blog: According to the latest modelling from Digital Finance Analytics, around half of all households in rental accommodation are struggling to pay their rent on time.

From Moody’s: Moody’s Investors Service says that delinquencies for Australian auto loan asset-backed securities (ABS) and residential mortgage-backed securities (RMBS) increased in January 2017 when compared with December 2016.

The Australian Securities and Investments Commission (ASIC) has today announced further measures to promote responsible lending in the home loan sector, which takes particular aim at interest-only mortgages: ASIC today announced a targeted industry surveillance to examine whether lenders and mortgage brokers are inappropriately recommending more expensive interest-only loans.

By Leith van Onselen Following in the wake of Mark Latham’s, Dick Smith’s, Bob Carr’s, and Judith Sloan’s recent calls to cut immigration to take the pressure off housing and infrastructure, and to improve housing affordability, Tony Walker – a Vice-Chancellor’s Fellow at La Trobe University – has now entered the fray.

Shame Oliver sees house price falls, at The Australian: Dr Oliver said it was no surprise to see APRA increase its focus on the investor lending market, but suggested the moves had come too late.

CoreLogic released its auction report yesterday, which revealed another weekend of strong auction conditions, with the national auction clearance rate rising to 78.1% from 77.1% last week, and remained well above the 66.6% recorded in the same weekend last year: Auction volumes nationally (2,646) were also way above the same weekend last year (1,582).

From Louis Christopher at the AFR: “It’s weak.

The Reserve Bank Board meets next week.

So say John Abernathy: According to John Abernethy from Clime, this shows just how much property speculation is going on right now as these investors only focus on getting a capital gain and not repaying the loan.

From S&P: The number of delinquent housing loans underlying Australian prime residential mortgage-backed securities (RMBS) increased in January to 1.29% from 1.15% in December, according to a recent report by S&P Global Ratings.

Pretty ordinary HIA numbers today.