Housing Market Update - July 2020
Corelogic has released its National Housing Market Update for July 2020.
Dwelling values declined -0.8% nationally in the June quarter, led by a 1.1% fall in values across the capital cities.
Looking at different value segments of the market, the rate of decline over the June quarter has generally been more significant across upper quartile value properties in Sydney and Melbourne, following a stronger upswing prior to COVID-19.
As consumer sentiment recovered to pre-COVID levels in June, more people have become confident in purchasing property. This is reflected in a 29.5% increase in sales volumes nationally over the month.
Growth in national rent values was 0.7% in the year to June. However, rent values are still -0.5% lower than the recent peak in March 2020.
National rental yields have come down to 3.73% in June, off the back of a -0.3% decline in rent values over the month.
Homes are taking longer to sell. Nationally, the median number of days on market rose from 43 days over the March quarter to 45 days over the June quarter.
Over the June quarter, vendor discounting started to deepen. The median vendor discount was 4.4% nationally, down from 4.3% in the March quarter.
More vendors are starting to test the market, as new listings have increased significantly over June. New listings across Australia had increased 44.3% from a low in early May.
Total listings continue to trend down, as sales activity has more than offset the rise in new listings. Total listings across Australia are 15.8% lower than a recent peak at mid-March.
As auction volumes started to recover, the combined capital cities auction clearance rate averaged 58.9% over June
ABS building approval data showed a significant decline in approvals over May, with dwelling approvals down 16.4% month-on-month across Australia. Dwelling approvals reached the lowest levels since January 2013.
New home lending among investors fell 4.8% over April, while owner occupier lending fell 5.0%.
The latest ABS finance data shows first home buyer lending as a portion of owner-occupier finance was at its highest level since December 2011.
Average mortgage rates produced by the RBA show that there was a decline in rates across most housing loan types over May. However, the pace of decline slowed compared with rate falls in April.
Should you wish to discuss this in the context of your financial situation, please do not hesitate to contact us to speak to an adviser.