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SQM Research Residential Newsletter - 
Tuesday 26 May 2020
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Words for the Week

“It took a pandemic to make me realize that I do have a family; that I do have friends; that I do have a heart and that I do have faith.” 

Anthony T. Hincks
Author

Real Estate Realities 

How sinking population growth will re-shape the property market

The initial impact of the coronavirus crisis on Australia’s property market was powerful and painful, but its effects are set to shape the industry for some time yet.

Experts predict that a huge slump in population growth as a result of COVID-19 will mean constrained demand and less affordability in the property market over the coming months.

Since January of this year, more than 310,000 temporary residents, migrants and itinerant workers have left Australia, according to Dr Shane Geha, managing director of Sydney-based EG Advisory and Urban Planning.

“This amounts to approximately two years of population growth leaving our shores in just a few months,” Dr Geha said.

“And a further 300,000 are predicted to leave before the end of the year, the effects of which are devastating to our economy and GDP.”

Meanwhile, net migration from overseas is expected to shrink by more than 85% in the next 12 months thanks to COVID-19.

 

AUCTION LISTINGS* for week ending 31 May 2020


CITY

Saturday

Rest of Week

 

STATE

Saturday

Rest of Week

Link

Sydney 359 77   All NSW 401 99 Auctions in NSW 
Melbourne 187 44   All VIC 198 49 Auctions in VIC 
Brisbane 23 46   All QLD 45 87 Auctions in QLD 
Perth 1 9   All WA 1 15 Auctions in WA 
Adelaide 15 15   All SA 15 17 Auctions in SA 
Canberra 13 8   All ACT 13 8 Auctions in ACT 
Darwin 1 2   All NT 3 4 Auctions in NT 
Hobart 0 0   All TAS 0 1 Auctions in TAS

*Note: To date, most state governments have announced the return to public open homes and on-site auctions this Saturday, some online auctions could be converted to on-site auctions or postponed to a future date.  The above counts of auctions represent most recent known auction dates for the coming week. 

AUCTION RESULTS for week ending 24 May 2020

Last week, Sydney recorded a final auction clearance rate of 47.0% with mid-week auctions faring worse than Saturday results (34.1% verses 49.3%). Sydney volumes continue to be at very low levels with just 270 properties for the week albeit this is the highest volume reading since the week ending 19th of April. The clearance rate  was slightly lower than the previous week’s 47.4%.
 
Melbourne recorded a clearance rate for the week of 44.8% with the  mid-week results fairing slightly worse than the Saturday results (44.1% verses 45.0%). Volumes remained at abnormally low levels at just 143  in total scheduled which was more than the previous week’s 123 but far lower than pre-auction ban levels.
 
Looking forward to this week, Sydney has 436 scheduled which represents another lift on recent volumes and getting back to more normal levels for winter. While Melbourne has 231 scheduled, which is still very low for Melbourne.


Full individual auction results can be found on our website: 




 

DISTRESSED PROPERTY OF THE WEEK

  Unit 1, 32 Bath Street, Labrador QLD 4215

A 2-bedroom apartment in the QLD Gold Coast suburb of Labrador is for sale at $329,000, $41k less than its last sale price of $370,000 in October 2006.

87 sqm in size, the apartment features 2 bedrooms, the master with walk-in-robe, large ensuite and its own private balcony; a spacious, air-conditioned lounge/dining area; kitchen with dishwasher; laundry with dryer; 2 side-by-side secure, underground car spaces and 2 large courtyards.

Built in 2006, the apartment is perfectly positioned within walking distance to the fabulous Broadwater and walking distance to local restaurants, including Charis Seafoods and the Grand Hotel. It is also close to public transport, schools and a 5 minute drive to Harbour Town Premium Outlets.

This is a property that offers you the best of the Gold Coast lifestyle with Labrador being an attractive place for down-sizers and first home buyers looking for a sea change, and investors seeking value for money. 

Asking Prices in postcode 4215 has shown good growth with a 2.4% increase over 3 years and a 1.5% increase over the month for 2-bedroom units.  House asking prices have remained stable over the month after a 10.3% increase over 3 years in this area.

The agent has provided a rental appraisal of $360.00 per week for the apartment.  Asking rents have shown declines of 3.5% over the month for 2-bedroom apartments in this postcode.  In comparison, the Gold Coast Main region’s asking rents have a smaller decline of 2.4% over the month but the Gold Coast region vacancy rate is 4.5% compared to postcode 4215’s vacancy rate of 2.5% (increasing from 1.4% in March).  Investors should still be impressed with a potential 5.4% Gross rental yield for units in this postcode.

Currently, an increase in distressed sales can be seen in some tourist areas such as the Gold Coast region due to Covid-19 travel restrictions and this interstate owner has given clear instructions that the unit must be sold and all offers are to be submitted.  Owner occupiers might find this modern apartment in a great location, good value for money.

Keep monitoring this market’s growth with 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 a real estate professional or a serious residential property investor, you will not want to miss this report!

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. 

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: 26 May 2020  Asking Price    Chg on
  prev week
 Rolling month
% change
  12 month
% change
Sydney  All Houses  1,387.0 -1.3  0.6%  13.7% 
All Units 704.9 -1.9  -0.2%  3.2% 
Melbourne  All Houses 1,043.8 -0.2  0.2%  11.9% 
All Units 562.1 -1.2  0.3%  4.0% 
Brisbane  All Houses 639.6 0.6  -0.3%  3.5% 
All Units 374.4 1.1  0.3%  0.8% 
Perth  All Houses 664.2 -0.3  1.9%  1.1% 
All Units 376.9 0.7  0.9%  -1.9% 
Adelaide  All Houses 527.9 1.0  1.6%  2.9% 
All Units 305.4 -2.5  0.1%  1.3% 
Canberra  All Houses 821.7 -2.6  -0.2%  1.4% 
All Units 439.4 0.2  -0.3%  2.4% 
Darwin  All Houses 574.4 -0.6  -2.0%  -3.0% 
All Units 342.0 5.5  6.2%  -4.2% 
Hobart  All Houses 567.9 -0.2  -1.7%  9.8% 
All Units 353.8 6.4  -1.1%  17.4% 
National  All Houses 597.7 -0.4  -0.2%  5.3% 
All Units 389.8 -0.2  -0.4%  3.9% 
Cap City Average  All Houses 995.0 -4.2  0.5%  10.1% 
All Units 573.3 -2.3  -0.0%  2.6% 

Next update: 2 Jun 2020

SQM Research Weekly Rents Index
Week ending: 20 May 2020     Rent     Chg on
  prev week
 Rolling month
% change
     12 month
% change
Sydney  All Houses    645.9 -1.9  -2.1%  -6.5% 
All Units 480.2 -0.2  -0.4%  -4.9% 
Melbourne  All Houses 533.3 -1.3  -0.9%  -1.6% 
All Units 406.5 -0.5  -1.4%  -4.1% 
Brisbane  All Houses 458.7 1.3  -0.1%  -0.0% 
All Units 377.1 -0.1  0.3%  1.5% 
Perth  All Houses 448.6 1.4  -1.5%  -0.1% 
All Units 345.6 1.4  -0.6%  2.4% 
Adelaide  All Houses 408.0 0.0  0.0%  4.0% 
All Units 318.3 0.7  1.3%  4.7% 
Canberra  All Houses 627.0 -1.0  -2.8%  0.4% 
All Units 465.3 -1.3  0.4%  1.6% 
Darwin  All Houses 481.5 1.5  3.2%  -3.9% 
All Units 354.6 0.4  -1.3%  -4.2% 
Hobart  All Houses 429.9 -0.9  -2.0%  -0.0% 
All Units 389.1 -7.1  -0.2%  -0.5% 
National  All Houses 440.0 0.0 -0.2%  0.2% 
All Units 370.0 4.0  1.1%  0.8% 
Cap City Average  All Houses 538.0 1.0  -0.6%  -3.1% 
All Units 427.0 -1.0  -0.2%  -3.4% 

Next update: 28 May 2020

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