July auction results for Australian sellers keep a lid on prices
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July auction results for Australian sellers keep a lid on prices

By Robyn Willis
Mon, Aug 8, 2022 12:27pmGrey Clock < 1 min

Properties are taking longer to sell and vendor discounting has increased, according to data from CoreLogic. In the three months to July, the median days on market was 32, up from a low of 20 days over the three months to November.

Clearance rates also slowed across the country through July, down to an average of 53.3 per cent by the end of the month.The clearance rate for the equivalent period in 2021 was 74.4 per cent.

However, clearance rates have already seen an improvement in the first week of August, with CoreLogic economist Kaytlin Ezzy reporting that Sydney’s preliminary clearance rate was more than 60 per cent for the first time since late May. That was on the back of the quietest auction week since mid July, with 1,471 homes auctioned across Australia’s combined capital cities.

Sydney offered just 476 homes for auction, down from 624 properties a week earlier.

In other states, Brisbane held 153 auctions, Adelaide had 146 and Canberra 67.



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The crafty workarounds would-be buyers use to get into the market

First time buyers determined to enter the Australian property market are taking creative approaches as interest rates steady

By Bronwyn Allen
Thu, Mar 28, 2024 2 min

Aspiring first home buyers are increasingly pooling their resources, adopting new strategies and making compromises to get themselves onto the property ladder, according to research from Westpac. About 56 percent of buyers surveyed are planning to buy their first property jointly with their partner compared to 40 percent three years ago. Three in four buyers say they are willing to compromise on location, up nine percent from three years ago, and 47 percent are willing to pay lenders mortgage insurance to buy their first home sooner.

Additionally, one in two first home hopefuls are considering ‘rentvesting’, whereby they purchase an investment property first ahead of a home for themselves. In this scenario, buyers typically continue renting in expensive lifestyle locations where they want to live and buy an investment property in more affordable locations, often on the outskirts of major cities or in regional areas.

The 2024 Westpac Home Ownership Report, released this month, is based on a survey of 2,015 Australians conducted in January. The report revealed increasing intentions to buy among all types of buyers, with 44 percent intending to buy in the next five years, up from 35 percent in July 2023. This may reflect expectations that interest rates have peaked, with the Reserve Bank keeping rates on hold since December.

Among first home buyers specifically, there was a slight decline in purchasing intention over the next five years, with 86 percent delaying buying a home due to cost-of-living pressures. The survey also found that more people are planning to buy an investment property, which is reflected in recent finance data from the Australian Bureau of Statistics showing a 20 percent increase in the value of investor loans issued over the past year. Additionally, more people are planning to upsize their homes or renovate their existing homes.

Westpac managing director of mortgages Damien MacRae said first home buyers “are becoming more ruthless with their goals”. “They understand it’s a big task, but they are determined to break into the market and are willing to compromise to get there,” Mr MacRae said.

Buyers still prefer houses, but there has been a five percent decline in this preference since 2021 and a seven percent increase for apartments. Preference for a townhouse, or house and land packages, has increased markedly. “Buyers are casting their expectations wider, willing to compromise on location and are forgoing everyday luxuries like food delivery. They are also more inclined to relocate and move to apartment living.”

The latest Westpac-Melbourne Institute Consumer Sentiment Index released this week shows the ‘time to buy a dwelling’ index rose 4.9 percent to 77.8 out of 100 this month, which is a 15-month high, but still relatively weak overall. Buyer sentiment is notably stronger in Victoria at 84.3, with Westpac senior economist Matthew Hassan pointing to softening home values over the past four months.

In contrast, the NSW index is at 73.3 out of 100, likely reflecting affordability challenges in Australia’s most expensive market. “Nearly 70 percent of consumers expect housing prices to continue rising in the year ahead,” Mr Hassan added.

 

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