The housing crisis in Australia continues unabated, with issues such as land scarcity and interest rate rises contributing to the scale of the problem.

Other impediments to homeownership, such as home prices far outstripping wage growth, have further compounded the crisis.

Supply issues especially remain a thorny challenge across the country; Perth’s property market is struggling mightily with this, as property listings on REIWA fell to a 13-year low in June.

Moreover, the national vacancy rate has dropped to a record low of 1.1%.

CoreLogic research director, Tim Lawless, said the National Housing Finance and Investment Corporation (NHIC), forecasts the national housing market is likely to be undersupplied to the tune of 106,300 dwellings over the next five years.

However, the addition of granny flat units to dwellings across Australia’s three largest capital cities could go some way toward easing the housing shortage.

“For policy makers and government, granny flats present an immediate and cost-effective opportunity to deliver much needed housing supply within existing town planning guidelines.”

Tim Lawless, CoreLogic research director

“For homeowners, the addition of a second self-contained dwelling provides an opportunity to provide rental housing or additional accommodation for family members, while at the same time, increasing the value of their property and potentially attaining additional rental income.”

Archistar co-founder, Dr Benjamin Coorey, said granny flats present a cost-effective opportunity to boost housing supply for growing capital populations close to existing infrastructure such as railways, bus routes, and major road networks for state and local governments.

“While building regulations for secondary dwellings differ state to state, this unlocks a combination of accessibility and opportunity to fast track affordable housing options for all demographics, particularly essential workers in industries such as the health care sector,” he said.

Archistar, Blackfort, and CoreLogic have assessed every residential block across Sydney, Melbourne and Brisbane to ascertain how many individual properties have building potential for a self-contained two-bedroom unit.

Sydney’s results

Lawless gave a dire forecast for Sydney’s supply, and said that Sydney’s household formation is forecast to outpace supply from 2025, with the most significant undersupply expected to persist until 2026 at a deficit of 15,900 dwellings.

Sydney is home to the most granny flat development opportunities, however, with 242,081 existing residential dwellings fitting the zoning, land area, and existing home position requirements to build a granny flat, according to the analysis.

The top five council regions for the most granny flat development opportunities were found to be:

• The Central Coast (41,569/17.2% of all potential sites).
• The Northern Beaches (19,884/8.2% of all potential sites).
• Hornsby (18,344/7.6% of all potential sites).
• Blacktown (17,909/7.4% of all potential sites).
• Ku-Ring-Gai (14,617/6.0% of all potential sites).

Melbourne’s results

Although Sydney’s supply outlook is not fortuitous, Lawless said Melbourne’s is set to be even worse.

“Melbourne is expected to face a major housing shortage from 2023 to 2027, with a deficit of 23,800 dwellings, which is nearly twice the anticipated shortfall of 12,100 new dwellings in Sydney during the same period,” he said.

Within Melbourne’s broad regions, the municipalities for the most potential for numerous granny flat development sites were:

• The Mornington Peninsula (23,870/10.4% of all potential sites).
• Casey (16,861/7.4% of all potential sites).
• Monash (13,960/6.1% of all potential sites).
• Knox (13,741/6.0% of all potential sites).
• Manningham (13,063/5.7% of all potential sites).

Brisbane’s results

As a point of difference from the other two capital cities, Lawless said Brisbane’s housing supply shortfall is more imminent at a housing supply deficit of 3,100 dwellings this year.

The top five Brisbane suburbs with the highest potential for granny developments were:

• The Gap (2,986/48.8% of all potential sites).
• Alexandra Hills (2,789/46% of all potential sites).
• Redbank Plains (2,479/30.3% of all potential sites).
• Albany Creek (2,378/44% of all potential sites).
• Rochedale South (2,215/42.3% of all potential sites).

Source : ThePropertyTribune

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The Australian property market saw new listings leap 9.4% in August, according to the latest Ray White listings report written by Ray White data analyst, William Clark.

This will be music to the ears of many property-buying hopefuls, particularly in view of July’s sauntering pace, but total listing figures are not as rosy. Recent CoreLogic data showed that while new listings rose across winter, total advertised supply levels are still well below last year, across the combined capitals.

Early start to the spring selling season

New listings tend to pick up around spring, while the winter months are typically slower.

However, with the solid uplift in new listings across August, experts have declared that the spring selling season has begun early.

New listings rose again last month

Although new listings petered out in the latter half of 2022, current trends indicate that it will be improbable that 2023 will follow suit.

Indeed, all major cities recorded growth from July, signally how strong this trend was across Australia. Notably, Melbourne and Sydney reported a significant increase in new listings.

The Agency CEO Geoff Lucas told The Property Tribune that listings across the East Coast of Australia were up 22% on last year, with solid momentum in the previous seven days.

“This is in line with our sales growth which is also up 22% on last year and we anticipate that listings growth will continue in the coming months,” he said.

New listings movements for capital cities

Listings in regional Australia followed the same pattern, having recorded the same surge in new listings. Regional Queensland remained the most dominant non-capital city market, with the Gold Coast bringing in substantial new monthly listings.

However, new listings in regional Australia were still trailing behind the low listings of 2022.

New listings movements for regional Australia

Ray White listing authorities, which refer to the point when vendors have signed a listing but the listing is still not advertised, have been essentially unchanged, as authorities did not rise in August as they did in July.

Authorities are considered a strong lead indicator for future listings, having around a week’s lead before authorities become published listings.

Listing authorities

Sydney listings

Top growth and decline suburbs

Sydney’s new listings rose by 11.6% in August 2023, and 5.4% from July last year.

Tallawong and Colebee were the best-performing suburbs in terms of new listings, with stock spiking by 275% and 233%, respectively.

Pemulwuy had the sharpest decline in stock, with an 88% year-on-year (YoY) drop.

Melbourne listings

Top growth and decline suburbs

New listings in the Victorian capital grew month-on-month (MoM) by 17.2% and 5.8% YoY. While regional listings fell YoY, listings improved compared to July’s numbers.

Travancore and Diggers Rest had a 133% and 100% boost in stock, while Box Hill South had a 58% slump.

Brisbane listings

Top growth and decline suburbs

Listings rose MoM, albeit on a lower scale than the same month last year. Listings in regional Queensland followed the same pattern.

Waterford’s stock shot up by 80%, while St Lucia witnessed a 77% reduction in listings.

Adelaide listings

Top growth and decline suburbs

Like in Brisbane, Adelaide’s stock improved MoM, but trailed behind listings the same month last year.

The top growth suburb for Adelaide was Banksia Park, where listings increased by 200%. On the flip side, the top decline suburb was Aberfoyle Park, where stock contracted by 74%.

Perth listings

Top growth and decline suburbs

While Perth’s new listings rose by 6.8% from July, they remained 3.7% under August last year. Regional listings decreased by 7.6% between May and August, and are down by 31.5% YoY.

Forrestdale was the highest-growth suburb, with a 175% increase in listings, while Midvale followed closely with a 150% surge in new stock. Meanwhile, listings in Waikiki shrank by 70%, the most considerable decline in Perth.

Hobart listings

Top growth and decline suburbs

August was an excellent month for Hobart, which saw stocks rise by 14.8%, Australia’s most significant MoM growth. Nonetheless, the new listings are still depressed by 5.8% compared to August last year.

Battery Point had the most significant rise in listings, with 75% more stock available, while Sandy Bay has 38% fewer homes to purchase.

Darwin listings

Top growth and decline suburbs

Darwin’s new listings grew by 26.5% in August but still lagged behind YoY, with a 30.7% decrease from last year.

New listings increased in the top-performing suburb, Parap, by 25%. Bakewell had the steepest decline in listings, with a 73% fall.

Canberra listings

Top growth and decline suburbs

New listings soared by 31.2% MoM and 11.5% YoY in Canberra.

Harrison led the pack with a 175% YoY jump in listings, while Mawson had the highest decrease of 64%.

Source : ThePropertyTribune

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Brisbane property buyers continue to display a robust appetite for real estate, notching up a fourth straight month of price growth.

Mirroring the same wider national home value trend, property prices in the Queensland capital also grew in June at a slightly lower rate than the previous month.

Detached houses led the recovery, outpacing the growth rate of units for the second month in a row.

Although that rate of growth in June slightly eased compared to May, it remained strong despite the impact of rising interest rates and school holidays on the overall market.

It could be considered remarkable that buyer numbers remain resilient, considering the low consumer sentiment reminiscent of the initial shock of Covid and the Global Financial Crisis that prevailed at the start of the year.

The auction market in Brisbane showed stability from May to June. According to Apollo Auctions, the average clearance rate in June was 65 per cent, slightly lower than May’s 66 per cent.

While the average number of registered bidders per auction decreased slightly from 3.9 in May to 3.7 in June, there was a notable increase in the percentage of registered bidders who actively participated and made bids, rising from 60.3 per cent to 63.95 per cent across the two months.

Brisbane is now the second best performing property market among Australia’s capitals, sitting just behind Sydney according to the June price movement data.

While some individuals may choose to sell due to rising holding costs, particularly those transitioning from fixed interest rates in the latter months of 2023, the existing depth of buyers appears sufficient to absorb such changes.

Unless there are substantial shifts in demand drivers, it is unlikely Brisbane will witness further price declines in the short term.

New listings scarce in Brisbane

Again reflecting the broader national situation, the issue of limited supply continues to dominate the Brisbane market.

According to CoreLogic, new listings entering the market are 30 per cent lower than this time last year, while total listings in Brisbane have decreased by 15 per cent from a year ago.

This scarcity of available properties poses a significant challenge for Brisbane property buyers, as despite their willingness to make transactions, they struggle to find suitable options to purchase.

Sellers in Brisbane have been hesitant to put their properties on the market, primarily due to the lack of confidence in finding a new property to buy or rent.

In an exceptionally competitive rental market, the possibility of renting as an interim solution between a sale and purchase is challenging and often impossible.

The absence of widespread panic among sellers has resulted in a situation where they refrain from taking action, further tightening the market.

Options for buyers vary across different suburbs.

According to PropTrack data, certain suburbs experienced a significant decrease in new listings compared to the previous year.

Marsden, located in Brisbane’s south and known for its secondary school catchment zone, witnessed a decline of 64 per cent in the year to May.

Similarly, Yeronga and The Gap also had substantial drops in year-on-year listings, with 59 per cent and 55 per cent fewer properties available for sale, respectively.

On the other hand, some suburbs provided more choices for buyers.

Ashgrove in Brisbane’s inner northwest saw a remarkable increase of 108 per cent in year-on-year listings. Ascot and Auchenflower were also big movers over the year, each with 64 per cent more options.

Real estate buyers making compromises

The ongoing increase in interest rates is significantly affecting borrowing capacity, which in turn impacts the property demand, however, what we’re observing is that individuals are making compromises based on affordability, rather than delaying their property purchasing decisions.

Compared to other capital city markets, Brisbane property remains more affordable than most.

The dwelling value-to-income ratio for Brisbane is lower than that of Sydney, Hobart, Adelaide, and Melbourne. It’s little wonder buyers from other east coast capitals are increasingly drawn north.

Source: Corelogic.

According to CoreLogic, Brisbane property buyers need to allocate 40 per cent of their household income to cover mortgage payments.

While high and placing the average borrower in the mortgage stressed category, this percentage is 52 in Sydney, 45 in Hobart, and 44 in Adelaide, making Brisbane the most affordable capital city on the east coast.

This affordability factor has contributed to an influx of buyers relocating from the south in recent years.

Many of these newcomers have sold their homes in New South Wales or Victoria and found equally desirable properties in Brisbane, with substantial savings remaining.

Alternatively, some buyers are upgrading their homes to enhance their lifestyle, fully aware that they can stretch their budget further and secure a high-quality property in Brisbane.

Units no longer star of the show in Brisbane

In June, the values of dwellings in Greater Brisbane rose by 1.3 per cent, according to CoreLogic, translating to a quarterly growth rate of 3 per cent. The median value of a dwelling in Greater Brisbane now stands at $725,397.

Source: Corelogic.

Additionally, PropTrack data reinforces this positive trend, indicating a 0.08 per cent increase in dwelling prices for the month across Greater Brisbane. The median value of dwellings by PropTrack is recorded at $731,000.

Brisbane’s housing market has shown strong performance for the second consecutive month, with median house values outpacing unit growth.

In June, median house values experienced a 1.3 per cent increase, resulting in a quarterly growth rate of 3 per cent. The current median value for a house in Greater Brisbane stands at $806,781, according to CoreLogic.

PropTrack data also confirms positive growth in the housing market, reporting a 0.18 per cent increase in house prices for June.

Source: Corelogic.

In June, the median value for units in Greater Brisbane were outpaced by houses, recording a 1 per cent increase while reaching a new record median of $512,262.

This growth aligns with the housing market on a quarterly basis, which has also now experienced a 3 per cent increase over the last three months.

Over the past year, units have still outperformed houses in Brisbane, with a 1.5 per cent increase in median values compared to a 9.9 per cent decrease in housing values, as reported by CoreLogic.

Source: Corelogic.

However, in contrast to the above information, PropTrack data presented a slight negative change in median unit prices for Brisbane in June, recording a 0.5 per cent decline. The current median value for units, according to PropTrack, stands at $546,000.

Signs of mercy in tight rental market

According to the most recent data from SQM Research, the vacancy rates in Brisbane have remained stable from April to May, staying at 1 per cent.

While the overall city-wide trend remains unchanged, certain regions within Greater Brisbane are experiencing an increase in vacancy rates.

The Ipswich region, for instance, has seen a rise from its lowest point of 0.5 per cent in August last year to the current vacancy rate of 1.5 per cent. Similarly, the Brisbane CBD, which previously had a low vacancy rate of 0.9 per cent in February, has been consistently increasing and now stands at 1.4 per cent.

Brisbane is still witnessing robust international demand for rental properties.

Source: Corelogic.

Net overseas migration is projected to reach 400,000 this fiscal year, marking a remarkable surge of nearly 27 per cent compared to the previous record set in 2008. It is worth noting that the majority of international migrants prefer to rent rather than buy when they first arrive in Brisbane.

According to data from PropTrack, the top countries conducting rental searches in Brisbane include New Zealand, United States, United Kingdom, India, China, and Singapore.

Notably, the return of Chinese students to Australia has had a significant impact on the increase in rental searches, as confirmed by PropTrack data.

Over the past 12 months, house rents have increased by 8.6 per cent, as reported by CoreLogic, while unit rent growth has nearly doubled at 16.3 per cent.

Despite these trends, rental yields have remained steady this month, with gross yields for houses holding at 4 per cent and gross yields for units at 5.4 per cent.

Source : AustraliaPropertyInvestor

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Among those who lost money, the median loss widened to $40,000, compared to $33,500 in the June quarter, CoreLogic’s Pain and Gain Report for the September quarter found.

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