winter is coming ?
The idea of a cold wave in Australia`s housing market was rife a while ago by a series of tightening measures by the federal goverment on home loans and property taxes.
Today, with the latest house price report from Corelogic, Australia`s leading housing market evaluator, the decline in Sydney`s house price has finally become a reality!
According to statistics,
Prices in downtown Sydney fell 0.1 percent this month.
It`s the first time in 17 months that house prices in Sydney have fallen!
The Sydney Pioneer Morning Post said there were early signs of the decline, which slowed to 0.1 percent as early as September, while annual growth fell to 10.5 percent from 13 percent last year. After the monthly decline in house prices, Sydney`s house prices also set the lowest value of the quarterly increase in housing prices!
In the face of this scene, people can not help but ask!
Is the winter of the Australian real estate market really coming?
According to earlier analysis, the decline in Sydney`s house price was actually a predictable decline due to the combination of goverment regulation and the characteristics of the Sydney housing market itself.
According to Corelogic analyst Tim Lawless, the recent weakness in Sydney`s housing market was first due to the large number of investment buyers in Sydney, which currently accounts for more than half of all mortgages. And these buyers are relatively vulnerable, mortgage tightening and real estate investment regulation.
As a result, a period ago, Australia`s goverment raised the down payment ratio to 20%, and the introduction of more stringent loan eligibility checks, make this part of the buyer more cautious about entering the market! As a result, it also led to the current weakness of house prices in Sydney.
Second, APRA, Australia`s leading banking regulator, also wants to use regulatory measures to channel real estate money back into financial lending. They also hope to take advantage of the move to control the ratio of indebted homes, as excessive borrowing could eventually hurt consumers and the market.
Finally, in addition to investor autonomy and goverment regulation, further follow-up by other financial institutions contributed to the expected fall in house prices. We have previously reported that Citigroup, an internationally important lending bank, released the so-called mortgage blacklist a few days ago. In areas where housing is oversupplied, including much of Sydney, the threshold for home loans will be further raised to prevent the company from having its own bad debt problems.
And this measure is also a real blow to the enthusiasm of investment buyers, it is likely to be the last straw to cool down the Sydney housing market.
In short, the media are generally calm about the fall in Sydney house prices, after all, the decline is very small and in the early brewing.
bull
The fall in Sydney house prices is a warning for investors, but it may also be good news for other people! First, the biggest beneficiaries are likely to be other well-performing housing markets, as Sydney`s bleak outlook could prompt more money to flow to other cities.
According to reports, the current Hobart housing market performance can almost be described as strong. Home prices rose 1.7% last month and 14.3% for the whole year, according to reports.
Hobart is reported to have done so well mainly because investors in the housing market have better purchasing power. The median home price in the city is reported to be below A $ four hundred thousand, well below Sydney`s current median! This laid a good foundation for attracting investors, and investors in Sydney and Melbourne began to turn to Hobart, further boosting Hobart`s strong growth.
At the same time, Melbourne, where property experts had predicted that prices could also fall, continued to rise 0.9 percent in September, a modest but not as low decline as expected.
Tim Lawless said Melbourne was able to keep rising mainly because Australia`s national population was experiencing its fastest-ever growth, providing basic demand guarantees to maintain the momentum of house price rises in Melbourne.
In addition, other parts of the new state, such as Newcastle and Macquarie Lake, have increased by more than 15%, while Highlands and Shoalhaven in the south of the new state has also risen by 13.5%.
（往远处看） look into the distance
The Sydney housing market, which has been so hot for such a long time, has finally shown a tendency to cool down. But what about the future?
First, compared with the weakness of the commercial housing market, Sydney rental market is rising heat. The current rental market in Sydney and Melbourne almost doubled last year, according to Corelogic.
But the rate of return is only 3%,
Record low!
So earlier, there were plenty of real estate experts suggesting that investors could move the realisation to other cities! In order to get a higher return!
