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"Sales continue to soar"

"The sales surge experienced at the end of 2012 has continued well into 2013, with ACTON sales results showing significant growth.

 Sales for March 2013 were 69.31 percent higher than sales at the same time last year and the March quarter results were 47.99 percent higher than those recorded for the March 2012 quarter. 

Sales also increased by 21.15 percent over the very strong December 2012 quarter. “The market is performing extremely well and we have seen an incredible turnaround over the last 12-18 months,” said ACTON Managing Director Graeme Baxter. 

“Listings have fallen from nearly 14,000 at this time last year to around 8,500 at the moment, properties are selling in a shorter time frame, and demand remains strong. If you are thinking about selling I would certainly encourage you to talk to your local ACTON agent."

Strong first homebuyer activity throughout 2012 is having a positive effect on other areas in the market in 2013.

“Demand from the first homebuyer sector still underpins the market, but we are seeing greater activity from upgraders, with sales of properties in the $600,000 to $1 million price range increasing. Sales over $1 million are also growing and we have seen outstanding sales in off-the-plan developments, which reflect a recovery in the market as a whole,” said Mr Baxter.

 While the overall outlook is very good, each suburb is a mini-market in its own right, with different demand and conditions, and Mr Baxter says buyers and sellers need to have realistic expectations. 

“There are instances of properties selling at the first home open, receiving multiple offers or selling over the asking prices, but this does not happen for each and every property. Demand varies from suburb to suburb and within price brackets, I strongly recommend that people speak to their local ACTON agent to get up to date information on prices, days on market, 
demand and supply.”"

This article was sourced from Acton Real Estate May 2013 newsletter.

"March quarter results show strong market with steady prices"

"The Real Estate Institute of Western Australia says that sales activity in Perth’s housing market has returned to its 15 year average after three years of volatility.

Its data for the March quarter, released today, found that turnover lifted by 14 per cent across the state during the quarter as consumer confidence returned to property.

REIWA President David Airey said the surge in sales saw Perth’s median house price rise by at least $5,000 and he believed it would likely lift by up to $10,000 with late settlements.   

“It seems we have a new record for Perth’s median house price of $510,000, but it’s important to note that this is due largely to the composition of sales in which a greater volume of more expensive homes were being purchased,” Mr Airey said.

Around the state some 13,200 properties changed hands, up from 11,600 in December and up by12 per cent on the same time last year.

Units, apartments and villas performed better than houses during the quarter, lifting by around $10,000 to a median of $425,000. Mr Airey said that this had been pushed along by strong first home buyer activity.

“The number of selling days has hardly moved and now sits at an average of 57, but the good news is that old stock which has been lingering on the market for a while is finally starting to shift.

“However, the number of listings slumped to a relative low of 8,260 properties, given that around 12,000 is considered normal for Perth,” he said.

During the quarter half of all sellers were prepared to drop their asking price and of those who did the average gap between the asking and selling price was a drop of 5.6 per cent.

“This ‘seller sentiment’ has hardly budged over the last nine months but is to be expected given that the market has swung back to favour them.

“We see this through the emergence of price-bidding and multiple offers and with some vendors exceeding their asking price,” Mr Airey said.

The metropolitan rental market proved to be quite unusual during the quarter in that the vacancy rate rose but so too did median rents.

“Normally the vacancy rate tightens during the March quarter which is a seasonal occurrence.  It’s odd therefore that the number of available properties actually increased  from around 2,400 properties in December to 3,200 in March and during the same period rents went up 4.4 per cent,” Mr Airey said.

Perth’s median rent is now at $470 per week which typically breaks down to $480 for a house and $450 for a unit or villa.

Mr Airey said he felt that the large number of tenants ending their lease to buy their first home was contributing to the relaxing vacancy rate and that he would not be surprised if rents came down in the June quarter.

Across regional centers REIWA found there was virtually no price movement during the quarter or over the previous year, however there were pockets of exception.

Of greater note was the lift in turner experienced in several country areas.

Mandurah-Murray saw a healthy 40 per cent lift in sales while Bunbury was more modest with turnover up by 8 per cent. 

 

Busselton, Dunsborough, Augusta and Margaret River all had a kick-up in turnover but based on sales of fewer than 100 properties in each region.

Albany saw a 7 per cent boost in sales while neighbouring Esperance looks to have had a whopping 50 per cent boost in turnover on early figures

In Kalgoorlie-Boulder there was a healthy 13 per cent increase in sales, while in Geraldton and Greenough turnover was very flat with 120 homes sold in the December quarter and the same number sold in the March quarter.

In Broome there was little movement in turnover, while Port Hedland and Karratha showed no discernible lift from their lowest ever sales in the December quarter not experienced since the 1990s.

“This shows how quickly markets can turn; just 12 months ago many commentators were lauding the performance of these two Pilbara centres,” Mr Airey said.

Mr Airey said that overall it had been a good quarter for buyers and sellers with most indicators continuing to point to a long term stabilisation.

“REIWA agents are certainly reporting strong crowds at home-opens and multiple offers on well priced properties.

“First home buyer activity, however, appears to have peaked and has fallen to an estimated 26 per cent of established dwelling sales. It looks like their enthusiastic rush into the market over the last year is now declining.

“Even so, the healthy activity from new entrants to the market has been a terrific boost to trade-up buyers and generated a lot of sales activity among homes valued in the range of $600,000 to $800,000.

“The winter months are traditionally more quiet in the market, so it will be interesting to see how sales and prices progress through to June. I suspect it will be steady and confident but with a softening around rents in some areas,” Mr Airey said."

This article was sourced from REIWA.com.au

"RBA cuts cash rate to record low"

"BORROWERS got their first piece of good news from the central bank this year - reducing the cash rate to a record low of 2.75 per cent.
In 2012 the Reserve Bank of Australia cut the cash rate four times but the May board meeting ordered the first reduction for 2013.
In a statement, RBA governor Glenn Stevens said low inflation allowed the board to make a further reduction to boost economic growth.
March quarter inflation was 2.5 per cent, right in the middle of the RBA's target band of two to three per cent.
"At today's meeting the Board decided to use some of that scope," Mr Stevens said.
"It judged that a further decline in the cash rate was appropriate to encourage sustainable growth in the economy, consistent with achieving the inflation target."
UBS interest rate strategist Matthew Johnson said he thinks there won't be any more rates reductions for a while and this one was a line-ball decision.
"My read of the statement is they cut because inflation was low and because they could, not necessarily because they changed their outlook.
"I think that means they are not going to cut in the near term, they are pretty data dependent."
CommSec chief economist Craig James said nothing much has changed economically since the April meeting where the board kept the cash rate unchanged.
"The Reserve Bank has adopted the global central bank mantra of doing whatever it takes to get the economy growing at a faster rate," he said.
"There are risks in cutting rates to generational lows but the Reserve Bank believes it is a risk worth taking.
"The Reserve Bank has flagged further rate cuts, saying it has used only some of its scope to ease rates further."
HSBC chief economist Paul Bloxham said low inflation won the day.
"They have noted in the past that the link between the Aussie dollar and interest rates is pretty loose, so it's hard to know."
In its statement, the RBA said inflation is consistent with the target and a little lower than expected.
It also said the exchange rate had been at a historically high level over the past 18 months, which was unusual given the decline in export prices and interest rates during that time.
If today's interest cut was passed on in full then the repayments on a $300,000 mortgage would drop by about $46 a month on average."

This article was sourced from News.com.au and was written by Jason Cadden and Kim Christian.

"Is the property market getting back to normal?"

 This article is sourced from PerthNow.com.au and was written by Andrew Winter.

"COULD it be possible that the housing market is getting back to normal? That depends, of course, on how you define 'normal'.

There are many differences between the Australian, Britain and US property markets but these overseas markets can be terrific barometers for us.

 

In recent years, the overseas markets were devastated, with a slump in value, markets swamped with desperate sellers and innumerable foreclosures.

 

Those few buyers who were around found it difficult to get finance as credit and lending dried up. The picture was not good.

 

Back here, despite some ups and downs, our housing market did not fare so badly. Rather than dry up altogether, buyers were fewer. This meant those homes that did sell realised little or no profit.

 

But we appear to have come through it.

 

Our big cities, where demand is high and supply constrained due to a lack of land, have had the most confident growth and sustainable prices.

 

Holiday markets, rural and regional areas -- where demand is always more unpredictable and inconsistent -- felt the pinch most.

 

I was in Britain recently which is now showing signs of having come through the worst of it. Interest rates are low but funding is still a challenge. Nevertheless, people are buying, selling and moving again. There are no record breaking prices -- yet -- but sales are being achieved at fair values.

 

Like here, much housing stock has not had substantial capital growth for five to seven years. It only seems terrible because growth levels in recent decades were high double digits. But let's face it, we have to recognise that that is just not normal. The US is the housing market of extreme diversity. Houses can sell for $10,000 but you often find the tax you owe is almost half of that. And two years later, the value of the property has dropped to $7000 as high stock levels continue to push prices down.

 

Meanwhile, in New York demand is on the rise again and prices are pushing up. Likewise in San Francisco, where Silicon Valley salaries are again pushing up the prices of homes.

 

Away from the biggest cities, however, are places with high foreclosure rates and property prices in freefall. So the conclusion to draw out of all of this is that all three markets are behaving ``normally''.

 

Regardless of whether you are in Australia, Britain or the US, there are high-demand areas and places that haven't seen a value gain in half a decade.

 

Markets are driven by localised factors as well as macro-economic trends and this gives some context for why the market is behaving the way it is.

 

But in 2013 we do have something that was not always ``normal'' -- the amount of information you can access to help decide on the health of any real estate market.

 

If you are a property nerd like me, sites such as realestate.com.au here and in Britain rightmove.co.uk are a treasure trove. In the US my favourite site is trulia.com, which provides the market for properties and the official valuation -- often nowhere near the asking price.

 

I love pouring over these sites and seeing what's on the market -- it's all good fun.

 

And that's perfectly normal, isn't it?

 

Andrew Winter is a real estate consumer champion and the host of Selling Houses Australia on The LifeStyle Channel"