Sydney Property Owners Make Handsome Return
Despite recording the weakest growth since January.
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Sydney house prices rose by 0.9% in November, the weakest growth since January.
Despite the slower growth, Sydney property owners added $12,000 to the median house price last month, while Melbourne saw an increase of $5835.
Property prices in Sydney have climbed by 25.8% so far this year, 16.3% in Melbourne and 22.2% nationwide.
The CoreLogic home index shows Melbourne home values climbed by just 0.6% over the last month and nationwide 1.3%.
The curb in recent price growth comes as the major banks lift higher fixed-rate mortgages and listings flood the market.
The number of new listings rose 15.7% above the five-year average over the four weeks ending November 29 — the highest level since late 2015.
Further, the time it takes to sell a home has blown out to 25 days, compared to the recent low of 21 days in May. Clearance rates are also down with the capital city average dropping from 80% in early October to low 70% in late November.
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Excluding the Covid-19 pandemic period, annual growth was the lowest since 1992
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Australia’s commodity-rich economy recorded its weakest growth momentum since the early 1990s in the second quarter, as consumers and businesses continued to feel the impact of high interest rates, with little expectation of a reprieve from the Reserve Bank of Australia in the near term.
The economy grew 0.2% in the second quarter from the first, with annual growth running at 1.0%, the Australian Bureau of Statistics said Wednesday. The results were in line with market expectations.
It was the 11th consecutive quarter of growth, although the economy slowed sharply over the year to June 30, the ABS said.
Excluding the Covid-19 pandemic period, annual growth was the lowest since 1992, the year that included a gradual recovery from a recession in 1991.
The economy remained in a deep per capita recession, with gross domestic product per capita falling 0.4% from the previous quarter, a sixth consecutive quarterly fall, the ABS said.
A big area of weakness in the economy was household spending, which fell 0.2% from the first quarter, detracting 0.1 percentage point from GDP growth.
On a yearly basis, consumption growth came in at just 0.5% in the second quarter, well below the 1.1% figure the RBA had expected, and was broad-based.
The soft growth report comes as the RBA continues to warn that inflation remains stubbornly high, ruling out near-term interest-rate cuts.
RBA Gov. Michele Bullock said last month that near-term rate cuts aren’t being considered.
Money markets have priced in a cut at the end of this year, while most economists expect that the RBA will stand pat until early 2025.
Treasurer Jim Chalmers has warned this week that high interest rates are “smashing the economy.”
Still, with income tax cuts delivered at the start of July, there are some expectations that consumers will be in a better position to spend in the third quarter, reviving the economy to some degree.
“Output has now grown at 0.2% for three consecutive quarters now. That leaves little doubt that the economy is growing well below potential,” said Abhijit Surya, economist at Capital Economics.
“But if activity does continue to disappoint, the RBA could well cut interest rates sooner,” Surya added.
Government spending rose 1.4% over the quarter, due in part to strength in social-benefits programs for health services, the ABS said.
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Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.
