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THE DECEMBER 17 ISSUE OF
C21 MARKET WRAP
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L U P T A T U M Z Z R I L D E L E N I T A U G U E D U I S 42
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C21 MARKET WRAP
01
CENTURY 21
64
CHAIRMAN STATEMENT
WHAT THE NEW FINANCIAL YEAR WILL BRING FOR PROPERTY
BY CHARLES TARBEY CHAIRMAN CENTURY 21 AUSTRALAISA
The new financial year heralds a time for change and new things, and this may be particularly true of the Australian real estate market this year. Not only is the market demonstrating signs of shifting conditions and changing dynamics between buyer and seller, but recent legislative changes related to housing entered into force on July 1 which may further change the way Australians approach property transactions over the coming financial year. RETURN TO SEASONALITY The latest CoreLogic Home Value Index has shown a slight recovery from the slower results recorded in May where dwelling values fell 1.1 per cent. In June, CoreLogic recorded a 1.8 per cent increase in dwelling values over the month. CoreLogic reports suggest that despite the short term recovery, signs are pointing to less steam in the market. I am of the view that we may see the first real’ real estate cycle kicking in over the coming months, and we may experience a more seasonal market. Strong market conditions, buyer demand and cheap finance mean we haven’t really seen distinct differences
in seasonal activity over the past
up in less than favourable weather
few years, however a traditionally
conditions. This scenario may help
quiet winter market appears to be
you accurately value a property and
emerging. We are seeing less people
decide what you would pay for it. It
at auctions, and less energetic
is likely that spring this year will see
bidding conditions. Clearance rates
the traditional increase in stock that
are trending downwards however,
is characteristic of the season in real
while this may be perceived as a
estate, particularly with an influx
negative by some, I believe buyers
of completed apartment complexes
may be faced with better prospects
filling supply lines in some markets.
for property purchases in some situations. A quieter winter season can actually be a good time to buy as many are turned off venturing out to open homes in the cold or wet, and there may be less competition when inspecting a property. Not only this, you may be able to see a property in a truer light or even note how it holds
C21 MARKET WRAP
02
CENTURY 21
FIRST HOME BUYER LEGISLATION Recently released data from the 2016 Census shows that home ownership rates have declined, from 68.6 per cent in 1991 to 65.5 per cent in 2016. In a bid to improve prospects of home ownership, the
Victorian and New South Wales
we cannot predict movements with
over the March quarter. In contrast,
state governments introduced new
certainty, rates can move quickly
the quarterly trend in Melbourne
measures to assist first home buyers,
and I remind Australians to plan for
has been more resilient, with growth
including the removal of stamp duty
such scenarios to ensure they don’t
easing from 4.2 per cent over the
concessions, and grants for builders
come under future financial pressure
March quarter to 1.5 per cent over the
and purchasers of new homes up to
in a changing market. Contact Us *
three months ending June.
a specified thresholds. These came
Capital city dwelling values rise 0.8%
into force on 1 July 2017. As such,
over June quarter Despite a seasonally
there has been talk about first home
strong result over the month of June,
buyers re-entering the market from
the CoreLogic Hedonic Home Value
July and becoming a bigger
series shows capital
force to be reckoned
gains over the
with. I encourage first home buyers to balance the short term benefit of concessions with a smart, longterm investment decision. It is important not to rush in and buy any
second quarter
A quieter winter season can actually be a good time to buy as many are turned off venturing out to open homes in the cold or wet…
property for the sake of
losing
For Sydney, Mr Lawless said the more pronounced slowdown is supported by weaker auction clearance rates which have been tracking in the high 60 per cent range across the city
steam. The
over the last three weeks of June,
CoreLogic
while in Melbourne, clearance rates
Home
have moderated but remained above
Value
70 per cent. He said, Both markets
Index
experienced auction clearance rates
recorded a
consistently in the high 70 per cent to
recovery from
low 80 per cent range over the March
the 1.1 per cent
getting into the market or utilising concessions. They should
of 2017 is
W E A K E R A U C T I O N R E S U LT S A R E FURTHER EVIDENCE OF SLOWING HOUSING MARKET CONDITIONS.
quarter.
fall in May, with a 1.8 per cent rise in capital
SLOWER HOUSING MARKET CONDITIONS ALSO REFLECTED IN THE ANNUAL PACE OF CAPITAL GAINS.
carefully consider their financial
city dwelling values over the month
positon now and if rates changed
of June. According to CoreLogic
in the future, and ensure that the
head of research Tim Lawless, This
property they purchase sits within
stronger month-on-month reading
Across the combined capitals, the
a predetermined budget that takes
can be partially explained by the
annual pace of capital gains has eased
these factors into account - not just
seasonality in the monthly growth
from 12.9 per cent three months ago
short term concessions.
rates. Adjusting for this effect
to 9.6 per cent at the end of June
suggests an easing trend in housing
2017. Sydney’s annual growth rate
value growth has persisted through
has slowed to 12.2 per cent over the
the second quarter of 2017. The June
twelve months ending June 2017,
quarter results showed that capital
down from a recent high of 18.9 per
city dwelling values were 0.8 per cent
cent three months ago. Melbourne’s
higher across the combined capitals
annual growth rate is now the
index; the slowest quarterly rate of
highest of any capital city, surpassing
growth since December 2015 when
Sydney’s annual rate of growth
the combined capitals index fell by 1.4
despite easing from 15.9 per cent
per cent. Mr Lawless said, This trend
three months ago, to 13.7 per cent
towards lower capital gains across
over the twelve months.
SHIFT TO BUYERS’ MARKET It appears that the market is shifting in favour of buyers. Whilst the outlook may be looking a little cooler, there is still a solid underlying demand for property. Sellers may have to work a little harder to make their property stand out, and when the offers roll in they may have to be more open to negotiation in reaching an acceptable outcome between parties. It will also pay for buyers to remember that the financial year ahead may hold the potential for rate increases. Whilst
the combined capitals index is mostly attributable to softer conditions across the Sydney housing market, where quarter-on-quarter growth was recorded at 0.8 per cent over the June quarter; down from 5.0 per cent C21 MARKET WRAP
03
CENTURY 21
CORE LOGIC NEWS - MARKET TRENDS
CAPITAL CITY DWELLING VALUES RISE 0.8% OVER JUNE QUARTER Lorem ipsum dolor sit amet, consectetuer adipiscing elit, sed diam nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam erat volutpat. Ut wisi enim ad minim veniam, quis nostrud exerci tation ullamcorper suscipit lobortis nisl ut aliquip. Duis autem vel eum iriure dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla facilisis at vero eros et accumsan et iusto odio dignissim qui
duis dolore te feugait nulla facilisi. Duis autem vel eum iriure dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla facilisis at vero eros et accumsan et iusto odio dignissim qui blandit praesent luptatum zzril delenit augue duis dolore te feugait nulla facilisi. Lorem ipsum dolor sit amet, consectetuer adipiscing elit, sed diam nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam erat dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu.
facilisi. Lorem ipsum dolor sit amet, consectetuer adipiscing elit, sed diam nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam erat dolor in hendrerit in
facilisi. Lorem ipsum dolor sit amet, consectetuer adipiscing elit, sed diam nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam erat dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla facilisis qui blandit praesent luptatum zzril delenit augue duis dolore te feugait nulla facilisi. Duis autem vel eum iriure dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla facilisis at vero eros et accumsan et iusto odio dignissim qui blandit praesent luptatum zzril delenit augue duis
blandit praesent luptatum zzril delenit augue duis dolore te feugait nulla
augue duis dolore te feugait nulla
FEUGIAT NULLA. DUIS AUTEM Vel eum iriure dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla facilisis at vero eros et accumsan et iusto odio dignissim qui blandit praesent luptatum zzril delenit
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C21 MARKET WRAP
04
CENTURY 21
dolore te feugait nulla facilisi. Lorem ipsum dolor sit amet, consectetuer adipiscing elit, sed diam nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam erat dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla.
TOP TIPS FOR SECURING A PROPERTY PURCHASE Dolor sit amet, consectetuer adipiscing elit, sed diam nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam erat volutpat. Ut wisi enim ad minim veniam, quis nostrud exerci tation ullamcorper suscipit lobortis nisl ut aliquip. Duis autem vel eum iriure dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla facilisis at vero eros et accumsan et iusto odio dignissim qui blandit praesent luptatum zzril delenit augue duis dolore te feugait nulla facilisi.
1. LOREM IPSUM DOLOR SIT AMET Consectetuer adipiscing elit, sed diam nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam erat dolor in hendrerit. Molestie consequat, vel illum dolore eu feugiat nulla facilisis qui blandit praesent
BY CHRIS GRAY, YOUR EMPIRE CEO
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3.FEUGIAT NULLA. DUIS AUTEM
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C21 MARKET WRAP
05
CENTURY 21
OUTDOOR LIVING Laoreet dolore magna aliquam erat volutpat. Ut wisi enim ad minim veniam, quis nostrud exerci tation ullamcorper suscipit lobortis nisl ut aliquip. Duis autem vel eum iriure dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla facilisis at vero eros et accumsan et iusto odio dignissim qui blandit praesent luptatum zzril delenit augue duis dolore te feugait nulla facilisi. Lorem ipsum dolor sit amet.
C21 MARKET WRAP
06
CENTURY 21
Autem vel eum iriure dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla facilisis at vero. Eros et accumsan et iusto odio dignissim qui blandit praesent luptatum zzril delenit augue duis dolore te feugait nulla facilisi. Lorem ipsum dolor sit amet, consectetuer adipiscing elit, sed diam nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam erat dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla. Duis autem vel eum iriure dolor in hendrerit in vulputate velit esse molestie consequat, vel illum dolore eu feugiat nulla facilisis.
C21 MARKET WRAP
07
CENTURY 21
DUISAUTEM VELEUMIRIURE Dolor in hendrerit in vulputate velit esse molestie consequat vel illum dolore eu feugiat nulla facilisis at vero eros et accumsan.