What’s happening in the Australian property market? A state-by-state guide
Australia’s property market has been booming for some time now, and it seems as though the tide is slowly starting to change.
In case you’re considering buying a house in the near future, here’s a brief run down of how each state’s property market is faring right now.
New South Wales
The current median sale price for a home in NSW is $430,000, and sellers can expect an average of 92 days on the market before closing, according to CoreLogic group Property Value (PV).
However, the latest QBE Australian Housing outlook report from October 2016 shows that NSW is the only state where new dwelling starts are not meeting demand. This, can mean bad news for those on the hunt for a property, but good news for vendors. Many experts are currently estimating that the cyclical nature of the property market will soon see the state’s high purchase prices soon drop back down to regular levels.
Victorians can also expect homes to sit on the market for roughly 91 days on average, and will see a median selling price of $410,000 (PV).
The state’s current strength may lie in first-home buyer purchases, with this market growing 5.6 per cent in 2015/16 – whereas other states saw plateaus and declines. Unlike NSW, the dwelling starts in Victoria are a massive 40 per cent above demand, meaning that the recent property deficiencies may soon be at an end.
The median house sale price in Queensland is 400,000, and the average time spent on the market before a sale is 97 days (PV).
Dwelling starts here have hit 59 per cent more than the demand for new properties, which should soon mean plenty of choice for buyers of new properties in the state. In particular, this potential surplus supply is set to be mainly in apartment units. Interestingly, most regional centres such as Cairns and the Gold Coast have enjoyed moderate price growth over the past four years, apart from Townsville, which has seen price drops.
The ACT’s strong property market recently saw it take third place in the CommSec State of the States report from October 2016. This is reflected in its high median sale price of $535,000 and its low average time spent on the market at 71 days (PV).
On the other hand, rental prices have been dropping, which has helped bring the vacancy rate down to just 2.5 per cent this June. Plus, the ACT offers the highest proportion of commencements compared with forecasted demand, with 86 per cent more new starts than demand calls for.
South Australia is relatively very affordable, with median house prices sitting at $355,000, and properties spending as much as 99 days on average on the market before selling (PV).
Additionally, forecasts predict that the current surplus in supply will continue for the next two to three years, making for an excellent buyers market, but a less favourable one for sellers.
Western Australian properties are currently averaging 87 days on the market, and are selling for a median price of $460,000 (PV).
This state has seen declines in both first-home buyer loans, and loans for upgrades – although these numbers were slowing down. This, according the QBE report, means that “the pace of decline is slowing and the market will soon bottom out”. Perth already has a relatively high vacancy rate, and this is only set to rise with commencements being 61 per cent higher than demand.
In the past 12 months, median house prices have hovered around the $480,000 mark, and have sat on the market for an average of 94 days (PV).
The NT has seen one of the highest declines in lending for residential investment over the past year, and it’s expected that more and more people will slowly leave the area as the economy slows down. As such, it’s expected that there will be a surplus in supply over the next few years, making it more affordable for home buyers.
Finally, Tasmania offers the most affordable homes, with an average selling price of $275,000. It also has the highest average for time spent on market at 115, making it a true buyers’ market (PV). Like many areas around Australia, Tasmania has also seen an increase in surplus dwellings, with this number rising from 4,800 to 5,300 as of June this year.
Even though the state has seen a weaker economy over the past few years, there are signs that it’s back on its way up with improved non-residential building activity, exports, and household spending.
No matter which state you’re in, Beyond Bank can help you with your property goals with home loans to suit your needs.