Housing market seeing first signs of slowing

by AB16 May 2014
The number of newly-advertised houses on the market continues to increase, at more than 10% the levels seen a year ago.
Over the four weeks to 11 May, there were 43,166 newly advertised properties listed for sale nationally. The number of newly advertised property listings fell by -0.3% over the week and they are currently 10.9% higher than at the same time last year, RP Data figures show.
Across the combined capital cities, new listings were 0.9% higher over the week and 11.7% higher than a year ago.
However, total listings are down.
There are currently 244,491 properties listed for sale across the country, with total listings at a national level 0.4% higher over the week and -2.0% lower than they were at the same time last year.
RP Data research head Tim Lawless told brokers at the MFAA national conference this week that the housing market is starting to see the first signs of slowing.
Residential real estate is worth $5.4 trillion, roughly three times the value of superannuation ($1.8 trillion) and Australian listed stocks ($1.5 trillion)
Dwelling values have been on a growth path since June 2012, and over 10 years have grown at about 4% per annum – however this will not be sustained, said Lawless.
Across the combined capital cities, total listings have this week increased by 0.3%, however, they are -7.2% lower than they were at this time a year ago. Capital city listings account for just 42% of listings nationally.
RP Data economist Cameron Kusher does not believe the recent Budget will have much direct impact on the housing market, although it contained “few highlights”.
“The termination of the NRAS scheme will probably have the biggest impact on the housing market given that some developers have heavily utilised the scheme as a selling point for their projects. First Home Buyer Saver Accounts were also scrapped however, the take-up had been poor so it is likely to have limited overall impact.”
However, the temporary debt levy may impact on the higher end housing market and higher income earners could look to reduce their taxable income, he said.
“If this is the case, negatively geared investment properties may actually become more attractive.”