Earlier this month, the Turnbull government delivered the federal budget. On the same day, two key trends in the Australian property market were confirmed: housing prices are dropping, and sales listings are increasing in all the capitals, except Melbourne. As more properties come on the market, this will compound price drops, correcting the overvaluation of the market. At MacroPlan, we expect to see a reduction in prices across some segments of the market, which would result in buying opportunities for astute purchasers.One of the big-ticket items announced in the budget was a $75 billion 10-year national infrastructure plan aimed at delivering rail links, tackling traffic congestion and improving road safety.
Part One of the Australian Housing Market Cycle – What’s next?, can be found here. A key point made in last month’s e-news was that we needed to look at individual markets when looking at cycles. During the GFC, one less well-known fact is that some US cities comfortably missed the sharp falls experienced in most markets — there were very divergent experiences across its housing markets. And that has also be the case fairly consistently with Australian cities – in the Table below, the stories for Sydney, Melbourne and Perth are very different. Housing and property broadly, is one of the more cyclical elements of any economy and it is useful to understand the elements which underpin its natural cyclicality. On cycles, the RBA has referred to housing as being described by the ‘hog cycle’ in farming.
A REALLY LUCKY COUNTRY? The same day the 2018/19 Budget was released two key trends in the Australian property market were confirmed. First, that housing prices are dropping (as per CoreLogic data and SQM forecasts of 4%-8% for 2018/19). Except for Melbourne, sales listings are increasing and major medium term downside risks to the Australian economy remain as a result of extremely high housing prices. Housing prices have been in modest decline in Sydney and Melbourne for around 12 months – without the inevitable increase in interest rates. From a housing market perspective the inevitable increase in variable mortgage rates from 4% to 6% means that a $500,000 dwelling (with a 20% deposit) reduces in loan serviceability to $400,000 assuming the same repayment time.
Lainey joined MacroPlan Dimasi fulltime in December 2015, after completing a degree in Property from Melbourne University in 2015. Previous to joining MacroPlan fulltime, Lainey assisted on a part time basis, undertaking market research, data analysis and GIS mapping. Lainey has a diverse range of project experience across residential, retail and commercial property sectors, completing work for both the private and public sector.
It was announced on 2nd of May 2018 that a Hyatt affiliate has entered into a management agreement with PEC Portfolio Springvale Pty Ltd for a 200-key Hyatt Place hotel in Melbourne. Hyatt Place Melbourne Springvale will be in a prominent location at the intersection of Springvale and Dandenong Road. In the heart of the Monash Employment and Innovation Cluster, the hotel will find itself neighbour to several academic institutions, businesses and medical facilities.
Owing to its relative complexity as an industry compared to others there was a time of confusion about what is that defines tourism. After many years of considerable debate and discussion, a demand side concept of what constitutes tourism was adopted by the WTO in 1993 as the international standard for statistical purposes, and the following definition of tourism was developed: “Tourism comprises the activities of persons travelling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business and other purposes.” Tourism Australia is the Australian Government agency responsible for attracting international visitors to Australia, both for leisure and business events.
Driverless cars could worsen Perth’s urban sprawl because people will be happier to take longer trips if they do not have to be behind the wheel. They also risk making Perth’s neighbourhoods less walkable if people were discouraged from walking, cycling or catching public transport instead. The warnings came from experts speaking at the Planing Institute of Australia’s national congress in Perth this week. Author of Autropolis: The Diverse Mobility Revolution and strategic adviser Brian Haratsis said widespread use of driverless cars was inevitable in part because the Government could never afford the public transport required to connect communities to city centres.