I called top of the market a few months back partly because I was starting to see this as well. My guess is continued very moderate price growth through spring and slowly but steadily dropping clearance rates. For those that can wait a few months - there may be some decent bargains coming up!
"after Sydney dwelling prices grew 1.8 per cent in the last month of winter (with quarterly growth over winter of 5 per cent) they rose just 0.8 per cent during September"
"Mr Lawless said that rather than focusing on the monthly figures a better indicator of the property market were the quarterly figures showing 4.1 per cent growth for Sydney and 3.7 per cent growth for Melbourne."
The month of September's growth of 0.8% equates to 10 percent annualised growth!
The September quarter's growth of 4.1% equates to 17 percent annualised growth!
So now we are saying 10-17% growth is flat or falling?
The bulls will say anything to pretend the bubble isn't still inflating!
Home prices in Australia's capitals rose only marginally in September, slowing after three straight months of strong gains, with five of eight cities recording falls in the month.
The slowdown should actually be welcomed by the Reserve Bank of Australia (RBA)which recently has become concerned that a surge in borrowing to buy investment properties could lift prices to unsustainable levels.
The central bank is even considering whether banks should face tougher lending standards on some types of mortgages in an attempt to restrain investors.
Top RBA officials are due to appear before lawmakers on Thursday to answer questions on the housing market in the wake of the housing investment boom.
Figures from property consultant RPData-Rismark showed dwelling prices in Australia's major cities rose just 0.1 percent in September, from August when they climbed 1.1 percent.
Prices were up 9.3 percent on September last year, again pulling back from August's 10.9 percent pace.
"The annual rate of appreciation in dwelling values has actually been moderating since reaching a peak in April this year," said RP Data research director Tim Lawless.
"A moderating annual trend, as well as the relatively flat September result, is likely to be welcome news to policy makers and potential buyers after the winter months recorded the largest capital gain since 2007," he added.
The RBA has been especially concerned about the red-hot Sydney and Melbourne markets, and there were some tentative signs of a cooling there.
In Sydney, home prices rose by 0.8 percent in September from the previous month, but the annual pace of growth eased to 14.3 percent from 16.2 percent.
Prices fell by 0.8 percent in Melbourne for the month, while the annual pace slowed to 8.1 percent from 11.7 percent.
Still, the housing market remained strong overall with auction clearance rates above 70 percent and turnover high.
The median price of a home in Sydney was A$655,000 ($572,000), compared to A$535,000 in Melbourne and A$530,000 across all the major cities.
Rising home prices had been initially tolerated by policymakers as necessary to encourage a much-needed revival in home building, which is indeed underway.
I called top of the market a few months back partly because I was starting to see this as well. My guess is continued very moderate price growth through spring and slowly but steadily dropping clearance rates. For those that can wait a few months - there may be some decent bargains coming up!
Now, as the other poster has stated, that last month's growth has slowed to an annualised pace of 10%, and QoQ is at 17%, you're claiming some sort of credit as a soothsayer?
Damn wannabe spruiker - get your ass outta here clown, and take that useless broken clock logic with you.
The all out bull assault on Sydney will continue unabated.
"It were not best that we should all think alike; it is difference of opinion that makes horse races." - Mark Twain on why he avoids discussing house prices over at MacroBusiness. "Buy land, they're not making any more of it." - Georgist Land Tax proponent Mark Twain laughing in his grave at humourless idiots like skamy that continually use this quip to justify housing bubbles.
I called top of the market a few months back partly because I was starting to see this as well. My guess is continued very moderate price growth through spring and slowly but steadily dropping clearance rates. For those that can wait a few months - there may be some decent bargains coming up!
Now, as the other poster has stated, that last month's growth has slowed to an annualised pace of 10%, and QoQ is at 17%, you're claiming some sort of credit as a soothsayer?
Damn wannabe spruiker - get your ass outta here clown, and take that useless broken clock logic with you.
The all out bull assault on Sydney will continue unabated.
Unless of course we get another, "No one could have prediced this" GFC style collapse in the credit markets. Then all bets are off and everything is going down again. The risk is certainly there.
Unless of course we get another, "No one could have prediced this" GFC style collapse in the credit markets. Then all bets are off and everything is going down again. The risk is certainly there.
Yep that's the theory, my call is another year of stupidity before the minsky moment hits.
"It were not best that we should all think alike; it is difference of opinion that makes horse races." - Mark Twain on why he avoids discussing house prices over at MacroBusiness. "Buy land, they're not making any more of it." - Georgist Land Tax proponent Mark Twain laughing in his grave at humourless idiots like skamy that continually use this quip to justify housing bubbles.
Yep that's the theory, my call is another year of stupidity before the minsky moment hits.
That's your theory? We are headed for a "Minsky" moment in the next year? Doesn't that require a massive/exponential run-up in housing credit? Housing credit growth is quite subdued in Oz at the moment:
Housing values eased their way into Spring, with the RP Data CoreLogic Home Value Index posting a 0.1% capital gain across the combined capital cities over the month of September.
Dwelling values across Australia's capital cities were virtually flat over the month of September according to the RP Data CoreLogic Home Value Index which recorded a 0.1 per cent rise in values over the month. This translated into a 2.9 per cent capital gain over the third quarter of 2014. The flat result for September masks the fact that five of Australia's capital cities recorded a fall in values over the month whilst only Sydney (+0.8%), Brisbane (+0.7%) and Adelaide (+0.9%) recorded an increase in dwelling values over the month.
The September quarter saw capital city dwelling values rise by 2.9 per cent. According to RP Data national research director Tim Lawless, this was once again driven by exceptionally strong conditions across the Sydney and Melbourne markets where the quarterly capital gain rate was 4.1 per cent and 3.7 per cent respectively. Additionally, Adelaide recorded a solid increase in values over the September quarter, posting a 3.1 per cent capital gain. Brisbane (+0.6%), Darwin (+1.4%) and Canberra (+1.4%) also showed a capital gain in dwelling values over the most recent quarter. Perth (-0.6%) and Hobart (-1.0%) were the only two capital city markets to record a decline in dwelling values over the September quarter.
Dwelling values are now 9.3 per cent higher over the twelve months to the end of September 2014, with every capital city recording an increase in dwelling values over this period. Sydney values are driving the growth trend, increasing by 14.3 per cent over the past twelve months. A substantial gap exists between Sydney and the next best performer, Melbourne, where dwelling values increased by 8.1 per cent. Darwin was the third strongest performer over the past year with a 7.1 per cent capital gain, followed by Brisbane at 6.4 per cent and Adelaide at 5.8 per cent. Hobart values were 4.6 per cent higher over the past twelve months while in Perth, values were 3.2 per cent higher. Canberra recorded the lowest rate of annual capital gain at 1.7 per cent.
Despite the ease in capital gains over September, other indicators remained strong over the first month of spring.
Auction clearance rates continued to beat the 70 per cent mark week-to-week while volumes across RP Data real estate agent and valuation platforms remained strong which indicates heightened levels of industry and mortgage market activity.
According to RP Data's research head Tim Lawless, more listings are entering the market place as the weather warms up. He said that the big test for the housing market will be whether additional stock is absorbed by an increase in buyer numbers.
"The annual rate of appreciation in dwelling values has actually been moderating since reaching a peak in April this year. The fact that the annual trend of capital growth has been trending lower is an important factor to note as it highlights that the rate of capital gain is no longer accelerating. Even though housing market conditions remain very buoyant, we have been seeing the 12 month trend drifting lower since peaking at 11.5per cent in April.
"A moderating annual trend, as well as the relatively flat September result, is likely to be welcome news to policy makers and potential buyers after the winter months recorded the largest capital gain since 2007.
"The softer September result is also likely to be seen as a positive indicator by the Reserve Bank which has recently raised concerns about the level of value growth and speculative investing in the Sydney and Melbourne housing markets," Mr Lawless said.
The high rate of capital gain has sparked further debate around the sustainability of housing markets around Australia, however Mr Lawless, points out that most of Australia's capital cities are recording a sustainable rate of appreciation.
Since the beginning of 2009 we have seen Sydney values increase by approximately 51 per cent and Melbourne values up by almost 45 per cent. Across the state capitals, the next highest capital gain over this period has been Perth, where values are up 14.5 per cent.
According to Mr Lawless, the Reserve Bank has recently singled out Sydney and Melbourne as the markets that require some caution, particularly from investors who are buying into markets at a mature time in the growth cycle, at high price points and where rental yields are very low.
Additionally, Mr Lawless noted that when you look back through the cycles of the housing market, the current growth phase isn't as aggressive as what was recorded over previous cycles.
At their peak, on a rolling annual basis, capital city dwelling values increased at a faster pace over each of the previous three growth cycles in 2009/10, 2007 and 2001/03. The big difference over this cycle is that growth has been very much concentrated within the nation's two largest capital cities and has increased for a longer period than the previous two growth phases.
Mr Lawless said that what is concerning is that we have now seen the ratio of housing debt to disposable income reach a record level at 137.1 per cent and we are seeing substantial investor concentrations within the two largest capital cities, particularly in inner-city unit markets within these cities.
"The Reserve Bank has recently highlighted the risks that are becoming more evident in the Sydney and Melbourne housing markets and therefore it is no surprise that the Reserve Bank, together with APRA, is now contemplating the likelihood of introducing macroprudential tools to reduce some of the exuberance in the housing market and rebalance investor demand without having to resort to monetary policy," Mr Lawless said.
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