Today realestate.com.au launched its quarterly Property Outlook – January 2019 report (October to December 2018), analysing more than 80 million property searches.
While the worst may not be quite over for Sydney and Melbourne, conditions remain highly variable across the country, year-on-year declines in Melbourne (-1.48%) and Sydney (-5.93%) look to be far less severe than many are reporting.
Hobart, Canberra, Adelaide and Brisbane (in order of price growth) recorded price increases in 2018.
The report notes that two major events which could dramatically change the direction of the market are the Federal Election expected in May, along with the outcome of the Financial Services Royal Commission. The report states that early signs are suggesting restrictions on home loans will not be a big focus, pointing toward APRA removing the cap on interest-only loans toward the end of 2018.
The outcome of this year’s Federal Election also has the propensity to dramatically impact the market. While a more stable Government is good news for the market, it is the potential changes to negative gearing and capital gains concessions that could continue to lead to price falls.
State by State
Although Sydney retains the highest priced suburbs ($955,000 median house price) many are seeing the biggest drops in Australia, with middle priced suburbs suffering the most. The interest in Byron Bay from Hollywood celebrities has led to the local Richmond-Tweed region seeing the highest price growth in NSW, and the fourth strongest in Australia.
Melbourne’s west is gaining popularity with the area seeing the strongest growth (1.8% year-on-year). Despite Melbourne’s overall softening, regional Victoria is booming with Ballarat, Geelong and LaTrobe-Gippsland performing well.
Inner-city Brisbane is defying the country’s downturn with prices up 2.2% whilst some suburbs in the Gold Coast are doing particularly well – Main Beach has seen almost 30% year-on-year growth and Currumbin is up over 13%. Large volumes of search activity on realestate.com.au from Sydney suggests these price increases may be driven in part by Sydney money.
Canberra is currently the second strongest market in Australia and will benefit from a change of Government. This is partly because Labor Governments tend to employ more staff and there’s a high need for consultants in the early stages of taking office. With price growth at 1.35% over the past 12 months, it’s unlikely these flat conditions will turn negative in the first half of 2019.
SA and Tas
Adelaide and Hobart are bucking the downturn-trend with Adelaide’s city medium hitting the highest level recorded and no region experiencing decline, whilst Hobart was not far-off double-digit year-on-year price growth. Medindie in Adelaide and Battery Point in Hobart both broke records by becoming each city’s first $2 million and $1 million-dollar suburbs respectively.
WA and NT
Perth and Darwin premium suburbs are holding up well – West Perth saw prices rise by almost 27% whilst Fannie Bay in Darwin saw over 7% growth. However, overall, both Perth and Darwin recovery has been derailed by the Royal Commission.
Download a copy of the report here.
An interactive version of the report can be found here.