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SQM Research Residential Newsletter 
Tuesday 4 February 2020
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Black Dragon's
Words for the Week

“We are all faced with a series of great opportunities brilliantly disguised as impossible situations.” 

Chuck Swindoll

Real Estate Realities 

How a Gippsland family defended their home from fire as bush burned metres away

Parched brown earth lines the road to John Hermans’ home in East Gippsland. His home of 40 years is just a few kilometres inside the fire line; on the scale of this summer’s continent-scarring flames, his property was caught by a hair’s breadth.

Bush that once surrounded the home has now become blackened trees with unnaturally red and brown leaves, hanging limp from surviving branches.

Almost as surreal as the torched landscape is the Hermans’ family’s home and gardens, still green and apparently untouched because of their firefighting efforts in late December. Even the solar panels survived, unwarped and functional.

Others were not so lucky. The fires have raged since spring and have killed 33 people and destroyed more than 2000 homes and many more structures. Two such buildings belonged to some of the Hermans’ neighbours.

John built the house himself with fire-resistant features. And although those in the industry say no home can ever be completely fireproof, the recent blazes raise questions about how Australian homes should be designed in future as the changing climate means extreme weather events will become more frequent and severe.

His house is cut into the north-facing side of a hill, just below the crest. There’s no space between the roof and ceiling or the floor and ground for embers to get caught in and start a fire. The roof itself is covered with soil and vegetation, which acts as insulation too.

NEW PROPERTY LISTINGS SURGED IN JANUARY
by Louis Christopher, CEO, SQM Research 
 
Figures released today by SQM Research, reveal national residential property listings increased in January by 2.2% from 288,966 in December 2019 to 295,295. Compared to 12 months ago, listings were down by 10.0%.

All capital cities experienced increases in property listings over the month with the largest increase in Sydney of 5.1%, followed closely by Hobart with 4.9% increase. Canberra had the smallest increase of 0.6% listings.

Year-on-year listings show declines for all capital cities with Sydney recording a significant decline of 24.8% and Darwin a 24.7% decline this time last year. However new listings (listings less than 30 days old) recorded a surge for the month and are higher than same levels recorded in January 2019.

The month of January traditionally records small falls in properties listed for sale as the market is still in a summer holiday mode however, the positive start in new listings shows vendors are now keen to sell and we could see further increases in the coming months.

 

Asking Prices
Capital City asking prices decreased by 0.4% for both houses and units, over the month to 28th January 2020. The year commenced with unit asking prices at $575,100 and houses $973,500.  
Compared to a year ago, the capital city asking prices posted increases of 5.5% for houses but a 0.1% decline for units.

Over the month, Melbourne, Brisbane, Adelaide and Hobart recorded increases in both house and unit prices.  Sydney was the only city to post declines in both, houses and units, 0.6% for houses and 0.7% for unit prices.  Perth and Canberra recorded minor decreases in house prices of 1.1% for Perth and 0.4% for Canberra houses.  Darwin house market has made a turnaround with increase of 0.6% in house prices however unit prices declined 0.4%.

Canberra had the strongest growth of 1.4% in the unit market whilst Hobart’s house prices had the strongest growth of 1.3%. 




DISTRESSED PROPERTY OF THE WEEK

3 / 3-7 Banrock Place, Mawson Lakes SA 5095

This double-storey townhouse at Banrock Place, Mawson Lakes, approx. 12km north of Adelaide’s CBD, has 3 bedrooms, 2 bathrooms plus an additional toilet; an open plan kitchen, dining and living area; secure parking and veranda and balcony.
 
Built in 2007, the property has a floor space of 120 sqm and is in one of Adelaide’s popular suburbs. This postcode saw an annualised population growth of 8% in 2011 and 3% in 2016 (source: Australian Bureau of Statistics).  38% of the population are renters.  To obtain further essential market statistics and graphs for any Australian postcode, subscribe to SQM’s
Postcode Snapshot report.
 
The townhouse is walking distance to Mawson Lakes train station, shopping precinct, schools, University of SA and many cosmopolitan cafes and restaurants. Walking trails and recreational reserves are footsteps away.
 
The property has been listed for sale since October 2018 for $349,000.  The price is now reduced to $329,000 which is less than when it was last sold for $337,000 in March 2011.
 
Asking prices in postcode 5095 have currently increased 0.6% over the month for 3-bedroom houses after a 2.6% increase over 12 months.  Unit prices were down 6.2% over 12 months but have now increased 0.4% over the month for all units.
 

Asking rents increased 6.2% for 3-bedroom houses over the 12 month but has since decreased by 1.4%.  Unit asking rents shows marginal growth of 0.1% over the month, after a 2.6% increase in 12 months.  Rents for houses range from $390 to $400 per week and unit rents are $325 to $332 per week.  This townhouse is currently rented at $350 per week since March 2019. 
 
A gross rental yield of 4.8% can be achieved for houses and 6.2% for all units.  Stock on market has decreased from 227 in November to 206 in January 2020. Current vacancy rate is 2.0%. 
 
This property is move-in ready and would be a good value family home for an owner-occupier or for an astute investor looking to add to their portfolio. 

 
For a more indepth look at the property market for 2020, subscribe to 
Christopher’s Boom and Bust Report 2020.

SQM website also 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: 4 Feb 2020  Asking Price Chg on
  prev wk
  Rolling month
% chg
  12 month
% chg
Sydney  All Houses    1,348.6 15.3  1.6%  8.8% 
All Units 717.0 0.9  -0.9%  1.4% 
Melbourne  All Houses 1,022.1 -9.3  -0.8%  6.0% 
All Units 552.5 2.3  0.7%  0.0% 
Brisbane  All Houses 642.6 2.0  0.8%  3.7% 
All Units 372.9 0.3  0.6%  -0.5% 
Perth  All Houses 650.4 1.0  -0.7%  -2.3% 
All Units 375.9 -0.2  0.4%  -3.6% 
Adelaide  All Houses 526.0 0.9  0.7%  2.1% 
All Units 302.6 0.6  0.5%  0.5% 
Canberra  All Houses 819.3 0.1  -0.4%  -0.9% 
All Units 439.2 1.1  1.8%  3.7% 
Darwin  All Houses 571.8 2.2  1.2%  -2.2% 
All Units 308.2 0.3  -0.2%  -23.6% 
Hobart  All Houses 547.7 -3.8  0.6%  10.4% 
All Units 353.0 9.4  3.8%  11.0% 
National  All Houses 589.0 1.8  0.5%  4.0% 
All Units 387.7 1.6  0.9%  3.0% 
Cap City Average   All Houses 977.3 3.8  1.1%  6.7% 
All Units 577.8 2.8  -0.1%  0.9% 

Next update: 11 Feb 2020

SQM Research Weekly Rents Index
Week ending: 4 Feb 2020   Rent   Chg on
   prev wk
   Rolling month
% chg
   12 month
% chg
Sydney  All Houses    700.4 1.6  2.2%  -1.5% 
All Units 501.5 0.5  1.2%  -1.7% 
Melbourne  All Houses 544.1 1.9  1.2%  0.1% 
All Units 420.6 2.4  1.9%  1.3% 
Brisbane  All Houses 471.8 -1.8  -0.3%  3.0% 
All Units 377.0 0.0  -0.2%  0.7% 
Perth  All Houses 444.6 1.4  1.0%  1.1% 
All Units 338.7 0.3  0.4%  2.9% 
Adelaide  All Houses 405.1 1.9  0.2%  2.9% 
All Units 311.2 -1.2  -1.6%  3.2% 
Canberra  All Houses 638.9 3.1  0.7%  -0.6% 
All Units 460.8 -0.8  -0.6%  -0.9% 
Darwin  All Houses 460.1 -5.1  -2.9%  -9.4% 
All Units 378.6 -1.6  -1.5%  -1.5% 
Hobart  All Houses 448.8 -1.8  -4.1%  6.8% 
All Units 428.0 -9.0  4.6%  14.2% 
National  All Houses 452.0 0.0 0.9%  0.9% 
All Units 372.0 -2.0  2.5%  1.6% 
Cap City Average   All Houses 561.0 -1.0  1.3%  0.4% 
All Units 441.0 0.0 0.9%  -0.2% 

Next update: 12 Feb 2020

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