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As we know, Australia is a large country with many capital cities at different points in the property cycle. The September data continues the trend of an extremely diverse national housing market.
Let’s take a look at how each capital city performed in September.
Sydney:
Capital Growth (all dwellings): -0.1% ⬇︎
Median Dwelling Price (all dwellings): $909,613 ⬇︎
Gross Rental Yield, Houses: 2.8% -
Gross Rental Yield, Units: 3.6% -
New South Wales Unemployment Rate (August): 5.0% -
We continue to see the Sydney market cool, with rental yields and unemployment remaining unchanged. As we have mentioned previously, the cooling of the Sydney market is due to a number of factors, being the tightening of investment and interest only lending by the banks and tightening of foreign investment by the government. As reported by CoreLogic, property investors still make up more than 50% of mortgages across NSW, the highest in the country. So it’s to be expected that a tightening of investor mortgages would cool the market.
Melbourne:
Capital Growth (all dwellings): 0.9% ⬆︎
Median Dwelling Price (all dwellings): $703,816 ⬆︎
Gross Rental Yield, Houses: 2.6% -
Gross Rental Yield, Units: 3.9% -
Victorian Unemployment Rate (August): 6.1% -
The growth in Melbourne has slowed slightly, although is still a robust market. Like Sydney, there has been no change in rental yields or unemployment. The city continues to see auction clearance rates above 70% and low stock levels. Where there is demand, there will be capital growth.
Brisbane:
Capital Growth (all dwellings): 0.3% ⬆︎
Median Dwelling Price (all dwellings): $490,208 ⬆︎
Gross Rental Yield, Houses: 4.2% -
Gross Rental Yield, Units: 5.2% ⬇︎
Queensland Unemployment Rate (August): 5.7% ⬇︎
Brisbane houses recorded a gain of 0.2% and units 0.4% in September, although the 12-month growth for detached housing and units is 4% and -2.6% respectively. There are great opportunities in the detached housing market, unfortunately, we are seeing apartments bought off plan at the commencement of Brisbane's unit construction boom (mid-2011) currently selling for losses of up to 36%. More than 5,300 units have been completed in the capital this year, with another 11,000 being built. We expect to see declines in the unit sector continue as these come onto the market and are resold.
Adelaide:
Capital Growth (all dwellings): 0.0% -
Median Dwelling Price (all dwellings): $429,583 ⬇︎
Gross Rental Yield, Houses: 4.1% -
Gross Rental Yield, Units: 5.0% -
South Australian Unemployment Rate (August): 5.7% ⬇︎
Adelaide prices have held steady this month with little movement, although house capital grown has increased 5.5% in the past 12 months. This month also marks the halfway mark for the construction of the Tesla lithium-ion battery, being built near Jamestown. Scheduled for completion before December 1st, the battery (the largest in the world) will provide solar energy for 30,000 South Australian homes. Making the state one of the most progressive for renewable energy.
Canberra:
Capital Growth (all dwellings): 0.6% ⬆︎
Median Dwelling Price (all dwellings): $580,043 ⬆︎
Gross Rental Yield, Houses: 4.1% ⬇︎
Gross Rental Yield, Units: 5.3% -
Australian Capital Territory Unemployment Rate (August): 4.7% ⬆︎
Canberra continues with its consistent capital growth and in the latest ABS (Australian Bureau of Statistics) population data, it enjoyed an increase in the population by 1.8%, second only to Victoria. ACT tourism numbers have also hit record highs with 2.649M visitors up from 2.518M since June 2015.
Hobart:
Capital Growth (all dwellings): 1.7% ⬆︎
Median Dwelling Price (all dwellings): $391,618 ⬆︎
Gross Rental Yield, Houses: 5.0% ⬇︎
Gross Rental Yield, Units: 5.1% ⬇︎
Tasmanian Unemployment Rate (August): 6.0% ⬇︎
Hobart property prices continued to climb, with unprecedented capital growth. The city is currently experiencing the highest annual growth rate since 2014. The cost of housing also remains incredibly low compared to other capital cities and the national average.
Perth:
Capital Growth (all dwellings): 0.1% ⬆︎
Median Dwelling Price (all dwellings): $462,783 ⬇︎
Gross Rental Yield, Houses: 3.8% ⬇︎
Gross Rental Yield, Units: 4.3% ⬇︎
Western Australian Unemployment Rate (August): 5.9% ⬆︎
Things continue to look up for Perth, with the rate of capital losses continuing to slow. For the first time since 2016, the number of vacant rental properties in Perth has fallen below 10,000 to 9,990. In comparison, this time last year there were 10,924 vacant properties. Although, still a long way to go, it’s a positive sign nonetheless for the long time struggling market.
Darwin:
Capital Growth (all dwellings): -0.7% ⬇︎
Median Dwelling Price (all dwellings): $445,516 ⬇︎
Gross Rental Yield, Houses: 5.6% ⬆︎
Gross Rental Yield, Units: 5.7% ⬇︎
Northern Territory Unemployment Rate (August): 3.6% ⬆︎
Unfortunately, the Darwin market still doesn't show any signs of bottoming out, with prices continuing to drop at a consistent rate. The one positive for this housing market is rents are yet to drop in line with house prices, creating the strongest yields in the country.
Combined Capitals:
Capital Growth (all dwellings): 0.3% ⬆︎
Median Dwelling Price (all dwellings): $648,845 ⬆︎
Gross Rental Yield, Houses: 3.1% -
Gross Rental Yield, Units: 3.9% ⬇︎
Australian Unemployment Rate (August): 5.6% -
This month the ABS released the 12 months (March ’16 - March ’17) population growth by capital city. As we know, people need shelter and population growth creates demand for housing. In this time all states and territories recorded positive population growth with Victoria leading the charge at 2.4%, followed by the ACT at 1.8%. The Northern Territory, however, recorded the lowest growth at 0.1%.
New South Wales: 1.6%
Victoria: 2.4%
Queensland: 1.6%
South Australia: 0.6%
Western Australia 0.7%
Tasmania 0.6%
Northern Territory: 0.1%
Australian Capital Territory: 1.8%
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 / Real Estate Institute of Western Australia / Real Estate Institute of Queensland / South Australian Government.
*Unemployment rates with the exception of the Northern Territory and Australian Capital Territory are seasonally adjusted estimates.
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