HTW Property Review July 2013

“A lazy half million 2013” is the Theme of this month’s HTW Month in Review

HTW take a look at how the market stacks up in your locality and compare it against others from around Australia

Opinion on the Melbourne residential market begins at page 31. Here are some highlights:

•         With interest rates at record low levels it would appear that now is the time to buy residential property.
•         Properties with strong tenant demand and minimal holding costs will help to maximise your rental return; however homes with the potential for significant capital growth help to provide financial freedom in the long run.
•         The equity built up can be used to purchase another property.
•         This is particularly beneficial for those looking to expand their portfolio as one of the hardest obstacles to home ownership is coming up with the deposit.
•         Footscray, West Footscray and Maidstone show positive signs for strong growth in the detached/ semi detached market.
•         Footscray is expected to profit from the proposed and current development in the area including the Footscray Railway Station Redevelopment, Footscray Plaza redevelopment and the Whitten Oval redevelopment
•         The Melbourne apartment market is currently being watched very closely as evidence continues to emerge of an oversupply of apartments in the  development pipeline particularly in the metro area with approximately 25,500 expected to be completed by the end of next year.
•         Off the plan properties may be tempting with 10% deposits and reduced stamp duty, however a large portion of demand is coming from overseas.
•         The majority of foreign investors are only able to purchase new off the plan properties; so when it comes to selling years later, your market pool has shrunk considerably.
•         The Melbourne property market is currently a buyer’s market, giving potential purchasers the chance to shop around, negotiate and find themselves a bargain.

If you don’t already, you can subscribe to receive this report directly each month for FREE. Simply jump on the HTW website www.htw.com.au  and follow the prompts.

Thanks to alphabroker for this summary

HTW Property Review June 2013

“Medium term growth for the medium priced buyer”

– With interest rates at record low levels it would appear that now is a good time to buy residential property.
– Properties with strong tenant demand and minimal holding costs will help to maximise your rental return; however homes with the potential for significant capital growth help to provide financial freedom in the long run
– The Melbourne 2030 planning strategy has designated Footscray as one of the Major Activity Centres which are the preferred locations for future higher density residential and mixed use development.
– The Melbourne apartment market is currently being watched very closely as evidence continues to emerge of an oversupply of apartments in the  development pipeline particularly in the metro area with approximately 25,500 expected to be completed by the end of next year.
– Off the plan properties may be tempting with 10% deposits and reduced stamp duty, however a large portion of demand is coming from overseas.
– The majority of foreign investors are only able to purchase new off the plan properties; so when it comes to selling years later, your market pool has shrunk considerably.
– The Melbourne property market is currently a buyer’s market, giving potential purchasers the chance to shop around, negotiate and find themselves a bargain.
If you don’t already, you can subscribe to receive this report directly each month for FREE. Simply jump on the HTW website www.htw.com.au  and follow the prompts.

Thanks to Therese O’Neill from Alphabroker

HTW Property Review May 2013

“Eye Candy ‘What the big money will buy’?” is the Theme of this month’s HTW Month in Review

HTW are talking about the very aloof end of the market. It is here that buyers become impervious to trifling movements of things like interest rates, and much keener to ensure that political turmoil in a far off island state doesn’t interfere with their gold mining exploration.

Opinion on the Melbourne residential market begins at page 25. Here are some highlights:

•During the global financial crisis the prestige and super prestige property market was hit hard.
•Holiday homes were generally the first to be put on the market, followed by investment properties and then personal homes.
•Consumer and business confidence has increased, interest rates are low, and the outlook for the USA is brighter while Europe is still trying to push through its economic issues.
•Chinese investors who face tough property investment restrictions in their own country are looking to Australia as a safe and lucrative place to invest.
•The government’s introduction of the Significant Investor Visa which was introduced on 24 November 2012 is already showing signs of prevalence particularly in the apartment and prestige market – the government will fast track residency for  investors who invest at least $5 million in the Australian economy.
•While the prestige detached housing market is leaning towards a seller’s market, the high stock level of prestige inner city apartments is creating a favourable environment for buyers.
•There is a hangover of stock, particularly in the Docklands.
•Given the high proportion of land value for prestige and super prestige properties, there is room and often capital to be gained from renovation or new buildings.
•With strong demand from international investors, the outlook for prestige and super prestige property looks positive, particularly for houses where an under supply may eventuate.

If you don’t already, you can subscribe to receive this report directly each month for FREE. Simply jump on the HTW website www.htw.com.au  and follow the prompts.

Thanks to Alphabroker for this summary

Vacancy Rates and Median Rents

Melbourne’s inner suburbs experienced higher than usual vacancy of 3.8% in January this year but have since decreased back to a more normal figure of less than 3% for February and March according to the REIV. Conditions in the middle and outer suburbs have shown a similar pattern with vacancy decreasing since January.

As a whole, Melbourne saw a vacancy rate of 2.8% in March. Though this is a decrease from the summer spike of 3.6% in January, it is substantially higher than the July 2012 figure of 1.9%, showing an increase over this financial year.

Metropolitan Melbourne’s median rents overall have increased during this financial year according to the REIV. The median rent for houses increased from $380 per week in July 2012 to $395 per week in March 2013. Units similarly increased in this time period from $360 per week to $370.

The inner suburbs of Melbourne (0-10km from the CBD) saw median rents increase from $521 to $530 for houses and $380 to $395 for units between July 2012 to March 2013.

The middle suburbs (10-20km from CBD) showed a slight increase for house rents (from $390 to $395 per week) and a small decrease for units (from $360 to $350 per week) in this period.

The outer suburbs (20km+ from CBD) also showed an increase for house median rents (from $333 to $340 per week) but units remained stable with a median rent of $300 recorded in July 2012 and March 2013.

Source: The Real Estate Institute of Victoria Ltd (REIV)

HTW Month In Review Mar 2013

“Are rates causing any interest?” is the Theme of this month’s HTW Month in Review

Opinion on the Melbourne residential market here are some highlights:

– In the past 12 months we have seen an unusual event where multiple interest rate reductions do not appear to have spurred on the residential market in the same way they have over previous times.

– Efforts of the RBA to stimulate the home finance sector in 2012 appear to be having a mixed effect on home loan approvals within Victoria while also considering incentives (first home buyer reduction and stamp duty savings) being added and removed during the year.

-The tightening of credit controls by the banks, and the uncertainty around medium to long term job security, are likely to be at the heart of buyer resistance to be enticed by the offer of cheaper money……… for the moment anyway.

– The impact of consumer sentiment / job security is clearly reflected in the decline in approvals for home loans for properties located in the growth corridors of Melbourne and the first home owner markets.

– Job security is a major influence and the subdued property markets can have a strong correlation.

– The growth suburbs (first home owner markets) are among the most sensitive when it comes to changing interest rates due to the uncertainty of rates matched with the fixed incomes of residents in such areas.

– In these markets families are usually borrowing to their maximum capacity and interest rate changes can correlate directly to the families weekly expendable income amounts and impact day to day living standards.

If you don’t already, you can subscribe to receive this report directly each month for FREE. Simply jump on the HTW website www.htw.com.au and follow the prompts.

Thanks to Therese from Alphabroker