We are already in the 4th quarter of 2020 and the outlook for property in Australia is much more positive than first anticipated, with many regions showing a rise in home values, strong rental demand and increasing affordability.
Australia has seen stabilisation in economic and property market indicators as most states shift toward a “Covid-normal” phase.
CoreLogic data revealed that six out of the eight capital cities in Australia recorded a rise in home values over the month, with a 0.1% fall in dwelling values nationally which is the lowest decline since May, 2020.
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- review of the overall market
- the effect of the Federal Budget and government stimulus
- national housing supply (with spotlight on Sydney, Melbourne, Perth, Brisbane)
VACANCY RATES (eastern seaboard)
- Sydney – the Sydney rental market is mirroring the national trend and vacancies are trending down since restrictions were eased. The Sydney metropolitan vacancy rate is now sitting at 3.5%.
- Melbourne – similar to Sydney, Melbourne’s rental market has a higher number of properties on the rental market than it did a year ago, although the increased vacancies are largely concentrated on the CBD while many suburban markets have continued to tighten.
- Brisbane – Brisbane has experienced a slight reduction in vacancy rates over the course of 2020, with rents remaining stable from March to September with 0.2% increase in houses and a 1.6% decrease in units.
AFFORDABILITY
As Covid-19 continues to rip through Australia, its impact on incomes, the cost of living and unemployment will play a major role in housing affordability.
Despite having the longest lockdown out of the major capital cities, Victoria has a lower unemployment rate than QLD and is marginally above the average of all states. With lockdown 2.0 easing in November we should see an increase to employment and consumer confidence as was observed in other cities that relaxed restrictions earlier.
