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The August data shows the hot markets of Sydney and Melbourne continuing to cool and a subdued month for the remaining capital cities. Although we believe this is the case, the data is very typical of what we expect to see at this time of year. August is typically a very sluggish month with low stock levels and not much action as buyers and sellers hold out for Spring. It’s in September we expect to see the stock levels rise and a more buoyant market. 

Let’s take a look at how each capital city performed in August. 

Sydney: 

  • Capital Growth (all dwellings): 0.0% -
  • Median Dwelling Price (all dwellings): $909,914 ⬆︎
  • Gross Rental Yield, Houses: 2.8% ⬆︎
  • Gross Rental Yield, Units: 3.6% ⬇︎
  • New South Wales Unemployment Rate (July): 5.0% ⬆︎

The pollies in Canberra should be happy as the change in government policy on foreign investment (non-Australian citizens) and APRA (the regulator of Australian financial institutions) tightening lending rules are taking effect. Although people holding real estate in Sydney should have a big smile on their face with values rising by 75% since the start of the cycle in 2012.

Melbourne: 

  • Capital Growth (all dwellings): 0.5% ⬆︎
  • Median Dwelling Price (all dwellings): $695,500 ⬆︎
  • Gross Rental Yield, Houses: 2.6% ⬇︎
  • Gross Rental Yield, Units: 3.9% ⬇︎
  • Victoria Unemployment Rate (July): 6.1% ⬆︎

The Melbourne market has continued to roll with the punches. We are still seeing auction clearance rates above 70% and actual stock levels (houses for sale) are very low, causing the supply vs. demand (number of houses for sale vs. the number of people wanting to buy a property) ratios to be in the sellers favour, keeping the market a little more steady. 

Brisbane: 

  • Capital Growth (all dwellings): 0.2% ⬆︎
  • Median Dwelling Price (all dwellings): $488,757 ⬇︎
  • Gross Rental Yield, Houses: 4.2% ⬆︎
  • Gross Rental Yield, Units: 5.3% -
  • Queensland Unemployment Rate (July): 6.2% ⬇︎

Overall the Brisbane market has remained slow and steady, like all states, there are submarkets within the market. We are seeing capital growth in Brisbane sub markets far exceed the pace of growth being recorded for Brisbane. 

Adelaide: 

  • Capital Growth (all dwellings): 0.0% -
  • Median Dwelling Price (all dwellings): $430,109 ⬇︎
  • Gross Rental Yield, Houses: 4.1% ⬆︎
  • Gross Rental Yield, Units: 5.0% ⬆︎
  • South Australian Unemployment Rate (July): 6.2% ⬇︎

Adelaide continues to be affordable with a diversified economy and stable housing market. It’s also an exciting time with Tesla planning to manufacture the largest lithium-ion battery in the world here. It could be the start of great things for the state.  

Canberra: 

  • Capital Growth (all dwellings): 0.6% ⬆︎
  • Median Dwelling Price (all dwellings): $575,173 ⬇︎
  • Gross Rental Yield, Houses: 4.2% ⬆︎
  • Gross Rental Yield, Units: 5.3% ⬆︎
  • Australian Capital Territory Unemployment Rate (July): 4.6% ⬆︎

Canberra ties first place with Hobart for the best performing capital city in August. With strong rental yields and low vacancy rates, it presents well for investment opportunities. 

Hobart: 

  • Capital Growth (all dwellings): 0.6% ⬆︎
  • Median Dwelling Price (all dwellings): $383,438 ⬆︎
  • Gross Rental Yield, Houses: 5.1% -
  • Gross Rental Yield, Units: 5.3% ⬇︎
  • Tasmanian Unemployment Rate (July): 6.3% ⬆︎

As predicted, Hobart was on track to be the best performing capital city in 2017. In August, the city takes the crown as Australia’s best-performing capital city based on the increase in all property values year to date of 7.1% and 12-month capital growth of 13.6%.

Perth: 

  • Capital Growth (all dwellings): -0.8% ⬇︎
  • Median Dwelling Price (all dwellings): $462,927 ⬇︎
  • Gross Rental Yield, Houses: 3.9% ⬆︎
  • Gross Rental Yield, Units: 4.4% ⬆︎
  • Western Australian Unemployment Rate (July): 5.4% ⬇︎

Darwin: 

  • Capital Growth (all dwellings): -2.2% ⬇︎
  • Median Dwelling Price (all dwellings): $449,234 ⬇︎
  • Gross Rental Yield, Houses: 5.5% ⬆︎
  • Gross Rental Yield, Units: 5.8% ⬆︎
  • Northern Territory Unemployment Rate (July): 3.2% ⬆︎

Every month we continue to talk about the declining Perth and Darwin markets, if there is a silver lining to this story it’s that the declining trends are easing. SEEK (Australia’s largest marketplace for online job listings) has released their July 2016 - July 2017 job listings data. This data shows that mining, resources, and energy sector job listings have increased by 73% in this period, which is a really positive sign for the resource dependent states of WA, NT, and QLD. Darwin also takes the crown from Hobart as Australia's most affordable capital city. 

Combined Capitals: 

  • Capital Growth (all dwellings): 0.1% ⬆︎
  • Median Dwelling Price (all dwellings): $645,405 ⬆︎
  • Gross Rental Yield, Houses: 3.1% ⬆︎
  • Gross Rental Yield, Units: 4.0% ⬆︎
  • Australian Unemployment Rate (July): 5.6% ⬇︎

When presenting states, regions, and properties we provide our clients with the most relevant and latest data so they can make an informed purchasing decision

Milk Chocolate was founded seven years ago by Richie Ragel and Michael Cleary, to purchase residential and commercial property in Australia on behalf of our clients, looking for a home or investment property. To see how we can help you get in touch here

Thanks, Michael 

Source: CoreLogic / Australian Bureau of Statistics / Herron Todd White / SEEK / REA Group / South Australian Government.   

*Unemployment rates with the exception of the Northern Territory and Australian Capital Territory are seasonally adjusted estimates. 

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