Australian Property Market Update March 2016
Knight Frank has released its latest findings of the Australian property market in its Australian Residential Review for March 2016.
Although it provides information for all of Australia’s major capital cities, we will be concentrating on Sydney, Melbourne and Brisbane property markets to help provide you with a greater understanding of what is happening in the marketplace right now.
Sydney The New South Wales Gross State Product has seen a 2.4% increase over the past year up to June 2015 and sits at $506,918 million. Unemployment at January 2016 also stood at 5.4% for greater Sydney, compared to the 5.3% which was recorded in January 2015.
Sydney has seen an increase in the number of building approvals and over the three months to January, there were 3,436 houses approved alongside 8,878 apartments approved within the Greater Sydney region. Houses are trending 11.6% higher and apartments are 5.6% lower compared to the same period in 2015.
The median capital value of houses in Sydney as at January 2016 stood at $1,046,000, whilst apartments were much more affordable at a median capital value of $686,000. Capital growth however has been slower compared to last year where houses and apartments saw 14.8% and 12% growth respectively. Compare this with last month where houses saw -1.8% growth and apartments -0.4% growth.
The Sydney market is definitely slowing down and property prices are starting to decline to more reasonable levels which isn’t a bad thing, especially for home buyers and first home buyers trying to enter the market. In spite of this, Sydney remains the most expensive capital city in Australia to buy a property and we are starting to see investors look for alternative areas in Melbourne and Brisbane where prices are much more affordable.
However, for first home buyers then there are still pockets of areas in Sydney that are more affordable and we recommend looking at the western region as well as up north.
Interestingly, Gosford saw 18% capital growth for both houses and apartments, with the median capital value at $516,000 and $382,000 respectively. This is one area that we are focusing on right now and to find out more information about the Gosford region and what new apartments we currently have available, why not contact the iBuyNew team at 1300 123 463 today.
Melbourne Melbourne remains as Australia’s second most expensive capital city, but is more affordable than Sydney. The median capital value of homes in Melbourne stood at $754,000 in January 2016 compared to $501,000 for apartments. Capital growth is also slightly better for Melbourne where houses saw capital growth of 2.3% last month, whilst apartments saw 1.1% growth. However, this growth is much slower compared to last year which saw 6.1% growth for apartments and 14% for houses.
Melbourne still has plenty of building approvals activity and the three months to January saw a total of 5,366 houses and 6,402 apartments approved within the Greater Melbourne region. However, compared to the same period in 2014, Melbourne’s apartment approvals are 27.1% lower, but houses are 6.8% higher.
Brisbane If you are looking for affordability then Brisbane is the city for you. The median capital value of apartments here is just $381,500, compared to houses at $506,000. Apartment prices are much more affordable in Brisbane and you can still get good brand new apartments within 5km of the Brisbane CBD for less than $400,000, which is great news for both investors and home buyers. This is now impossible in Sydney and you are forced to look further afield with commutes of around one hour.
Capital growth is slower in Brisbane, but it is expected to rise in the coming years. Last month, houses saw 1.1% capital growth and apartments saw -0.8%. However, last year houses saw 4.5% growth and 2.8% for apartments. With Sydney and Melbourne’s property markets slowing down, Brisbane is the city to watch, especially as it is now in the upswing phase of the property cycle.
With the ABS projecting the population of Greater Brisbane to reach 3.2 million persons in 2031 from an estimated population of 2.3 million in 2014, plenty more housing is required to meet this demand.
In the three months to January, there were 2,503 houses and 4,323 apartments approved in Greater Brisbane. This is lower compared to the same period in 2014 (6.2% lower for houses and 4.9% lower for apartments), but with the projected population of almost 1 million more people within the next 15 years, new apartments and housing will be required to meet this.
In spite of this sales for houses and apartments were up on last year. Houses saw an increase of 9.2% (42,350 houses) and apartments were up 11.2% (20,850 apartments).
Overall, Australian median house and apartments capital values have declined within the month of January 2016, down by 1.4% and 0.4% respectively. However, when looking in more detail at the ten year annual average growth of 4.3% for houses and 4.4% for apartments, the overall annual growth remains healthy at 5.8% for houses and 5.5% for apartments.
To learn more about the Australian property market and where you should be buying today, why not give one of our Property Consultants at iBuyNew a call. They will be happy to assist you with your property buying needs and can show you numerous properties to match your requirements.
Call us today on 1300 123 463 to speak to one of our expert Property Consultants.
Published on 29th of March 2016 by Marty Stanowich