Australia is at the forefront of
Australia-still-the-lucky-country
26th June 2009 | category [ Articles ]
recovery in the housing sector.
The stimulise package provided
by the Australian Government
is paying dividends
Recently the International Monetary Fund (IMF) upgraded its growth forecasts
for the Australian economy, stating “this is because of strong commodity exports,
a flexible exchange rate, a healthy banking sector, and a timely and significant
macro policy response”. The IMF expects Australia’s GDP to contract by a modest
0.5 per cent in 2009, before growing 1.5 per cent in 2010. The IMF has also
suggested that Australian interest rates should remain low for some time
considering the “fragile state of the global economy”.
The rosier outlook for economic conditions comes as other key market indicators
are also showing an improvement. The average level of vendor discounting (the
difference between the initial listing price of a property and the ultimate selling
price) has been improving with most cities now averaging a discount level around
6% of the original asking price (7% mid last year) and the average time it takes
to sell a property is now generally around 30 to 45 days.
Consumer sentiment, although somewhat volatile, has broken the 100 point
mark for the first time in 17 months, housing finance approvals are trending up
and market activity has improved. Additionally, the recovery in the auction
market has certainly withstood the test of time, with every capital city market
showing a substantial improvement in clearance rates over the last two months.
The two largest auction markets, Melbourne and Sydney, have averaged
clearance rates of 79% and 73% respectively over the last two months.
Compared to the same period last year these markets were averaging
clearances of just 50% and 43%.
Locally stock levels are still at a very low rate. Everything is being looked
at and bought by first home buyers. Agents are expressing to me that stock
levels are at a low in all price ranges. The halving of stamp duty on new homes
is certainly going to help with new stock, but leaves buyers without any more
insentive to buy. There needs to be discounts on stamp duty for existing homes
and for investors.
RPData Property Pulse
26/06/09