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SQM Research Residential Newsletter 
Tuesday 17 December 2019
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Words for the Week

"Christmas is forever, not for just one day. For loving, sharing, giving, are not to be put away." 

Norman Wesley Brooks
Real Estate Realities 

Sydney, Melbourne prestige property prices among most rapidly growing worldwide: Knight Frank

Luxury properties in Sydney and Melbourne recorded some of the biggest price growth in the world over the past decade, new research has found. And prices are tipped to rise even further next year as the ultra-wealthy population climbs.

Prestige property prices jumped 69.8% in Sydney over the past decade, and 64.1% in Melbourne, outpacing growth in cities like Hong Kong, Singapore, London and New York, a new Knight Frank report shows.

Prices in Sydney are expected to rise a further 4% in 2020, while Melbourne’s prestige market is tipped to jump 3%, according to the Prime Global Forecast report – which was topped by Paris with 7% projected price growth.

“The pipeline of new Sydney prime residential properties suitable for the ultra-wealthy population continues to be under-supplied, with some [residential projects] delayed or converted to another use,” said Michelle Ciesielski, partner and head of residential research at Knight Frank Australia.

Melbourne, by comparison, has had a number of prime luxury projects entering the market increasing competition at the top-end, Ms Ciesielski said. However, this had been matched by ultra-wealthy population growth, which is expected to increase by 21% to 625 individuals by 2023.

.Read More...

Vacancy Rates Increase Marginally in November

by Louis Christopher, CEO
 
Data released by SQM Research today has revealed the national residential rental vacancy rate increased marginally in November 2019 to 2.2% from 2.1% recorded in October.  The total number of vacancies Australia-wide is now at 75,947 vacant residential properties.  November 2018’s vacancy rate was 2.3%.
 
All states recorded an increase in vacancy rates with Darwin and Hobart’s vacancy rate remaining steady at 3.1% and 0.5% respectively.
 
Sydney continues to record the highest vacancy rate at 3.4% and since November 2018, the city's vacancy rate has been above 3.0%.
 
Melbourne, Brisbane and Adelaide all recorded minor increases in vacancy rates over the month of 0.2%. Perth and Canberra increased by 0.1%.




The rise in vacancy rates across most cities was expected in November as the year draws to a close and demand for rental accommodation drops. Sydney’s oversupply of rental accommodation continues, with the vacancy rate up from 3.2% a year ago. The city is still a renter’s market as is Darwin.
 
Our expectation is rental vacancy rates will rise again in December due to a seasonal decline in rental demand, predominantly driven by students returning back home.
 
Asking Rents
Over the month, Capital city asking rents increased 0.2% for houses but declined 0.2% for units as at the 12 December 2019, to record asking rents of $550 per week for houses and $434 per week for units.  In comparison, over the 12 months, asking rents declined 0.9% for houses and 0.5% for units.
 
Melbourne, Brisbane, Perth, Adelaide and Hobart all recorded increases in asking rents for both houses and units over the month. Hobart recorded the highest increases in asking rents of 4.0% for houses.

Darwin recorded the highest decrease for house rents of 3.9% but unit rents increased by 1.0%. 

Sydney managed to increase asking rents for houses by 0.3% but recorded rent falls of 0.7% for units. Canberra also increased house asking rents by 0.9% but decreased by 1.8% in units.


 
DISTRESSED PROPERTY OF THE WEEK
 
21 Cammeray Drive, St Georges Basin NSW 2540

A spacious 5-bedroom, 2 bath home in the sought after location of St Georges Basin in the south coast region of NSW, is for sale at a reduced price of $479,000 - $499,000.  It was initially listed at $580,000 - $610,000 in December 2018.   This property was last sold for $36,000 in December 1998 when it was newly built.
 
Sitting on a 660 sqm block, the home features a custom-built kitchen with timber benchtops; generous main bathroom; a large master bedroom with a walk-in robe and ensuite and 4 other over-sized bedrooms.  Outside is a covered outdoor entertaining area with a near new spa, a sun deck, established, well maintained gardens, double lock-up garages and 8 solar panels.
 
The home is in a great location just a short walk to local schools, parks, shops, sports fields and the shores of St Georges Basin plus a short drive to Jervis Bay and all that the south coast has to offer.
 

Asking prices for houses in postcode 2540 have increased 6.0% over 3 years and 6.5% over 12 months.  Over the past month, there has been a smaller 0.5% increase.  Based on current data, asking prices for houses in postcode 2540, range between $530,000 to $635,000.  Unit prices have had greater growth having increased by 10.4% over the month, after a 27% increase over 3 years.
 

Asking rents for houses have decreased over the last 12 months by 1.4% in the area but have increased by 5.1% over the month.  With a low vacancy rate of 2.1%, which has declined from 3.1% in July 2019, this house could be a good investment property.  A Gross rental yield of 3.1% can be achieved for houses.
 
This is a great holiday destination and makes an ideal weekend getaway, a permanent family home or an investment property.

 
For further insights into
 the property market in 2020, subscribe to Christopher’s Boom and Bust Report 2020.

SQM website features free property data that is now more interactive, easier to navigate and user-friendly, so keep monitoring this market’s growth at SQM Research’s free property data. Also consider the SQM Property Explorer product for more in-depth data and property price estimator.



 
Louis Christopher's 2020 Housing Boom & Bust Report has now been released and is available for $59.95!

The Housing Boom and Bust report is accurate, impartial and detailed. Best of all it is priced so that EVERYONE from real estate agents, financial planners to regular mums and dads can access it at just $59.95.
 
Key features of the 2020 Boom & Bust report include:

  • Louis Christopher's personal take on the markets 
  • Capital city forecasts 
  • Main drivers of demand and supply at present and going forward 
  • All leading indicators such as stock on market, vacancy rates etc
  • All the possible scenarios that could play out next year 
  • Nearly every city and regional postcode covered re: property stats plus ratings outlook

If you are interested in where the market is heading on a national level, then this is the report for you from one of the most accurate housing market forecaster in the country. 

If you are a real estate professional or a serious residential property investor, you will not want to miss this report!

Click here to purchase now!

 

SQM RATINGS NEWSLETTER

Did you know that SQM Research doesn’t only provide residential property data, we also provide research on all asset classes.  We have data and analytics on over 10,000 funds in Australia.  To find out more and to subscribe to our Fund Data tool click here.

If you would like to subscribe to our Ratings Newsletter, click here.  The newsletter provides regular updates on all funds including ratings changes and media releases, and valuable Insights into the point of view of our analysts on a variety of ratings research related topics.  And it’s completely free!

SQM RESEARCH HOUSING INDEXES
 
SQM Research Weekly Asking Prices Index
Week ending: 17 Dec 2019    Asking Price     Chg on
prev wk
    Rolling month
% chg
   12 month
% chg
Sydney All Houses 1,334.1 23.8  2.1%  5.7% 
All Units 716.5 3.0  1.2%  3.0% 
Melbourne All Houses 1,008.1 12.2  3.6%  4.6% 
All Units 550.8 -2.0  -0.7%  -0.8% 
Brisbane All Houses 636.5 0.6  0.6%  2.6% 
All Units 370.8 -0.5  -0.4%  -2.0% 
Perth All Houses 653.7 1.0  0.0%  -2.0% 
All Units 376.9 -0.9  -1.2%  -2.9% 
Adelaide All Houses 520.3 -0.3  0.2%  0.5% 
All Units 302.5 0.3  -0.0%  -0.4% 
Canberra All Houses 824.8 1.8  1.2%  -1.1% 
All Units 435.2 -2.2  0.2%  1.4% 
Darwin All Houses 570.5 -1.7  -1.1%  -1.7% 
All Units 310.5 -1.0  -1.2%  -15.2% 
Hobart All Houses 539.1 0.7  0.4%  7.4% 
All Units 334.4 -4.8  1.4%  6.4% 
National All Houses 586.7 0.2  -0.0%  2.8% 
All Units 386.4 2.3  0.4%  2.3% 
Cap City Average   All Houses 976.7 19.9  2.6%  5.6% 
All Units 576.3 -0.7  0.1%  1.2% 

Next update: 24 Dec 2019

SQM Research Weekly Rents Index
Week ending: 12 Dec 2019            Rent            Chg on
prev wk
   Rolling month
% chg
   12 month
% chg
Sydney All Houses 684.2 -3.2  0.3%  -3.4% 
All Units 494.0 -1.0  -0.7%  -2.5% 
Melbourne All Houses 534.5 -1.5  0.9%  0.0% 
All Units 410.1 0.9  0.4%  0.9% 
Brisbane All Houses 468.8 2.2  1.2%  3.0% 
All Units 378.5 0.5  0.6%  1.0% 
Perth All Houses 439.2 -1.2  0.1%  1.0% 
All Units 333.7 -0.7  0.0%  3.4% 
Adelaide All Houses 402.2 1.8  1.1%  2.7% 
All Units 313.9 -0.9  0.6%  4.4% 
Canberra All Houses 648.4 1.6  0.9%  3.7% 
All Units 462.8 -2.8  -1.8%  0.4% 
Darwin All Houses 483.0 -3.0  -3.9%  -4.2% 
All Units 380.8 2.2  1.0%  -2.1% 
Hobart All Houses 453.4 0.6  4.0%  6.4% 
All Units 422.8 -10.8  0.8%  20.6% 
National All Houses 448.0 -1.0  0.2%  1.1% 
All Units 364.0 -2.0  -1.1%  -0.5% 
Cap City Average  All Houses 550.0 -3.0  0.2%  -0.9% 
All Units 434.0 0.0 -0.2%  -0.5% 

Next update: 20 Dec 2019

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