Friday, December 18, 2015

Top 10 Perth Suburbs by Median House Growth

RP Data has also released figures that show Perth houses dropped 6.1% in 2015 which is $35,000 down to a median of $515,000.  Apartments fell 3.4% to $415,000. However there are some bright sparks. Here are the top 10 Perth suburbs that increased in value in the last 12 months.


BIGGEST INCREASE IN MEDIAN VALUE (HOUSES)
1. Brabham. Up 28.2 per cent to $450,186

2. Dayton. Up 22.7 per cent to $456,693

3. East Fremantle. Up 20.2 per cent to $1,312,018

4. Forrestdale. Up 13.1 per cent to $515,994

5. Upper Swan. Up 11.4 per cent to $704,539

6. Piara Waters. Up 11.2 per cent $543,795

7. Highgate. Up 10.8 per cent to $917,917

8. Swanbourne. Up 9.7 per cent to $1,642,736

9. Eglinton. Up 9 per cent to $349,679.

10. Oakford. Up 8.8 per cent to $965,396

Thursday, December 17, 2015

House prices - Perth down 3.3% while Sydney goes up 20%

The Australian Bureau of Statistics has released the latest residential property price movements for Australian states up to the September quarter. Perth's house prices have dropped 2.4% in the September quarter compared to the previous June quarter which has contributed to a 3.3% decrease over the past 12 months.

The Australian average for the last 12 months has been an increase of 10.7% increase in value, which makes Perth's -3.3% look pretty bad. In fact, Perth dropped the most over the last 12 months , with Darwin losing 2% over the same period. In contrast, Sydney has increase 19.9% over 12 months, with Melbourne increasing at 9.9%. 

WA unemployment has also recently increased to 6.4% while the Australian unemployment rate as a whole has fallen 0.1% to 5.8%. Tough year ahead..

Tuesday, November 3, 2015

Reserve Bank Keeps Australian Interest Rate Steady @ 2%

At its meeting today, the Board decided to leave the cash rate unchanged at 2.0 per cent.

The global economy is expanding at a moderate pace, with some further softening in conditions in the Asian region, continuing US growth and a recovery in Europe. Key commodity prices are much lower than a year ago, in part reflecting increased supply, including from Australia. Australia's terms of trade are falling.

The Federal Reserve is expected to start increasing its policy rate over the period ahead, but some other major central banks are continuing to ease monetary policy. Volatility in financial markets has abated somewhat for the moment. While credit costs for some emerging market countries remain higher than a year ago, global financial conditions overall remain very accommodative.

In Australia, the available information suggests that moderate expansion in the economy continues. While GDP growth has been somewhat below longer-term averages for some time, business surveys suggest a gradual improvement in conditions over the past year. This has been accompanied by somewhat stronger growth in employment and a steady rate of unemployment.

Inflation is low and should remain so, with the economy likely to have a degree of spare capacity for some time yet. Inflation is forecast to be consistent with the target over the next one to two years, but a little lower than earlier expected.

In such circumstances, monetary policy needs to be accommodative. Low interest rates are acting to support borrowing and spending. While the recent changes to some lending rates for housing will reduce this support slightly, overall conditions are still quite accommodative. Credit growth has increased a little over recent months, with growth in lending to investors in the housing market easing slightly while that for owner-occupiers appears to be picking up. Dwelling prices continue to rise in Melbourne and Sydney, though the pace of growth has moderated of late. Growth in dwelling prices has remained mostly subdued in other cities. Supervisory measures are helping to contain risks that may arise from the housing market.

In other asset markets, prices for commercial property have been supported by lower long-term interest rates, while equity prices have moved in parallel with developments in global markets. The Australian dollar is adjusting to the significant declines in key commodity prices.

At today's meeting the Board judged that the prospects for an improvement in economic conditions had firmed a little over recent months and that leaving the cash rate unchanged was appropriate at this meeting. Members also observed that the outlook for inflation may afford scope for further easing of policy, should that be appropriate to lend support to demand. The Board will continue to assess the outlook, and hence whether the current stance of policy will most effectively foster sustainable growth and inflation consistent with the target.

Wednesday, September 2, 2015

RP Data Reports Perth Houses Down 4.1% this Year

August 2015 has been a bad month for Perth. The median house price has dropped 1.3% in August, down 1.8% over the last three months. The drop in unit dwellings only fell by 0.4% during August after a 2.5% increase in the last three months.

Since the beginning of the year, house prices in Perth have dropped 4.1% and unit prices have dropped 3.5%. In other parts of the country, it is a very different story. Melbourne is up 11.4% since the beginning of the year. If you really want to know, Sydney house prices have increased 14.8% since January! Their increase over the last six years has been 76%. The sad thing is, experts predict that the Perth market will continue to fall so if you are looking for a home in Perth, it's your market now.


Tuesday, September 1, 2015

How much can you borrow earning $100k

Interesting graphic came out recently which shows the borrowing capacity allowed by various banks for someone earning $100,000 per year. Today, the RBA announced that they will hold the interest rate due to their concerns about the declining growth rate in China and the market instability there.

If you are saving for a home, you should also read our earlier post about getting the best interest rate for your savings. You could be losing thousands a year!


Click to enlarge

Thursday, August 27, 2015

$1.3m house under offer for $420k

Interesting article today showed the massive change that can happen in real estate in four years. A house that was sold in Port Headland in 2011 for $1.3 million is finally under offer today for only $420,000, about a third of the price that it was bought for. This is quite an extreme example because we're talking about a house in Port Headland, not suburban Perth. However, it shows that there is nothing guaranteed in real estate, as much as real estate agents swear hand on heart about.
Read the article here.

Saturday, August 15, 2015

How Well are You REALLY Saving for Your First Home?

Interest rates are at an incredibly low point at the moment and if you are one of those saving for their first home, this can be greatly frustrating. However, with such low interest rates, it is even more critical that you get your act together when it comes to choosing the right savings account for your money.

With the price of homes today, it would not be unlikely that first homebuyers have $200,000 sitting in a savings account. There is a savings account with ING which gives you up to 3.50% with their variable Savings Maximiser. The only condition -  transfer $1000 or more into their account every month (even if you transfer it back out and repeat).

If you are with the ANZ Online Saver account, after three months, you would be getting only 2% for your savings. Assuming you have $200,000, if the differential between ING and ANZ kept going for a year, you could lose $3,500 in one year of saving! If you kept that going for three years, that's $11,500! You can also look at Commbank's woeful offerings here or Westpac over here.

Even for a savvy saver who chooses a more competitive account like Ubank's Usaver account, for a $200,000 saving is $2,380 per year at the current differential rates.

Bankwest offers 3.25% with their Hero Saver account IF you don't touch your money each month. If you do, you get 0.01% and for that month if you had $200,000 in it, you would have lost $540 of interest for that month! Westpac does a similar account here offering 2.50% (and 0.01% if you withdraw any amount during the month). However, ING does not penalise you for moving money in and out of their 3.50% 2.75% (their rate has dropped 0.75% in the last year so in August 2016 this is the new rate) account which you can see can make a serious difference.

How to Apply?

If you would like to sign up to the ING Savings Maximiser, you will need to open an Orange Everyday account (a debit card which gives you 2% cashback for every purchase you make on paypass - a very good offer!). (ING Direct is no longer offering 2% cashback). If you want to get serious with your first home saving, our suggestion is to sign up with ING Direct and get $75 cashback by applying here.

Friday, August 14, 2015

5 Years of Perth Real Estate in One Heatmap Going Cold

Wow. This is a very useful graphic produced by Australian Property Monitors showing the last five years in Perth compared to the other capital cities in Australia. It seems that the mining boom has reversed Perth's fortunes in the real estate market with Perth becoming the most difficult market to sell in July with an average time on market of 112 days, as well as the average discount of  7.2%.



Tuesday, August 4, 2015

RBA Maintains Record Low 2% Cash Rate

At its meeting today, the Board decided to leave the cash rate unchanged at 2.0 per cent.

The global economy is expanding at a moderate pace, but some key commodity prices are much lower than a year ago. Much of this trend appears to reflect increased supply, including from Australia. Australia's terms of trade are falling nonetheless.

The Federal Reserve is expected to start increasing its policy rate later this year, but some other major central banks are continuing to ease policy. Hence, global financial conditions remain very accommodative. Despite fluctuations in markets associated with the respective developments in China and Greece, long-term borrowing rates for most sovereigns and creditworthy private borrowers remain remarkably low.

In Australia, the available information suggests that the economy has continued to grow. While the rate of growth has been somewhat below longer-term averages, it has been associated with somewhat stronger growth of employment and a steady rate of unemployment over the past year. Overall, the economy is likely to be operating with a degree of spare capacity for some time yet. Recent information confirms that domestic inflationary pressures have been contained. That should remain the case for some time, given the very slow growth in labour costs. Inflation is thus forecast to remain consistent with the target over the next one to two years, even with a lower exchange rate.

In such circumstances, monetary policy needs to be accommodative. Low interest rates are acting to support borrowing and spending. Credit is recording moderate growth overall, with growth in lending to the housing market broadly steady over recent months. Dwelling prices continue to rise strongly in Sydney, though trends have been more varied in a number of other cities. The Bank is working with other regulators to assess and contain risks that may arise from the housing market. In other asset markets, prices for equities and commercial property have been supported by lower long-term interest rates. The Australian dollar is adjusting to the significant declines in key commodity prices.

The Board today judged that leaving the cash rate unchanged was appropriate at this meeting. Further information on economic and financial conditions to be received over the period ahead will inform the Board's ongoing assessment of the outlook and hence whether the current stance of policy will most effectively foster sustainable growth and inflation consistent with the target.

Enquiries:

Media Office
Information Department
Reserve Bank of Australia
SYDNEY
Phone: +61 2 9551 9720
Fax: +61 2 9551 8033
E-mail: rbainfo@rba.gov.au

Wednesday, March 11, 2015

December to January 8.5% Drop in Home Loans

Home loan approvals for West Australians has dropped 8.5% in January this year with the total value of those loans also down 6.9% over one month. Sales of houses has also dropped 16% compared to the same time last year according to REIWA and building approvals were down 11.6% in January.

Friday, February 6, 2015

This time last year...

According to REIWA, there are 12,818 properties listed for sale in WA at the moment. That is a massive 48% more properties for sale than the same time last year when there were only 8,638 properties listed for sale.

The current average rent is $440 per week and the vacancy rate is 4.2%. One year ago this week, 943 properties were sold compared to 781 for the past week, 21% less than this time last year. It takes an average of 57 days to sell and the average discount is 5.3%.

Tuesday, February 3, 2015

Australia Cuts Interest Rates to 2.25%

After more than a 16 months at 2.50%, the Reserve Bank has cut the interest rates for Australia by 25 basis points to stimulate the economy. As a result, the Aussie dollar has plummeted to US 76.7c. Here is the RBA announcement in it's entirety. 


At its meeting today, the Board decided to lower the cash rate by 25 basis points to 2.25 per cent, effective 4 February 2015.

Growth in the global economy continued at a moderate pace in 2014. China's growth was in line with policymakers' objectives. The US economy continued to strengthen, but the euro area and Japanese economies were both weaker than expected. Forecasts for global growth in 2015 envisage continued moderate growth.

Commodity prices have continued to decline, in some cases sharply. The price of oil in particular has fallen significantly over the past few months. These trends appear to reflect a combination of lower growth in demand and, more importantly, significant increases in supply. The much lower levels of energy prices will act to strengthen global output and temporarily to lower CPI inflation rates.

Financial conditions are very accommodative globally, with long-term borrowing rates for several major sovereigns reaching new all-time lows over recent months. Some risk spreads have widened a little but overall financing costs for creditworthy borrowers remain remarkably low.

In Australia the available information suggests that growth is continuing at a below-trend pace, with domestic demand growth overall quite weak. As a result, the unemployment rate has gradually moved higher over the past year. The fall in energy prices can be expected to offer significant support to consumer spending, but at the same time the decline in the terms of trade is reducing income growth. Overall, the Bank's assessment is that output growth will probably remain a little below trend for somewhat longer, and the rate of unemployment peak a little higher, than earlier expected. The economy is likely to be operating with a degree of spare capacity for some time yet.

The CPI recorded the lowest increase for several years in 2014. This was affected by the sharp decline in oil prices at the end of the year and the removal of the price on carbon. Measures of underlying inflation also declined a little, to around 2¼ per cent over the year. With growth in labour costs subdued, it appears likely that inflation will remain consistent with the target over the next one to two years, even with a lower exchange rate.

Credit growth picked up to moderate rates in 2014, with stronger growth in lending to investors in housing assets. Dwelling prices have continued to rise strongly in Sydney, though trends have been more varied in a number of other cities over recent months. The Bank is working with other regulators to assess and contain economic risks that may arise from the housing market.

The Australian dollar has declined noticeably against a rising US dollar over recent months, though less so against a basket of currencies. It remains above most estimates of its fundamental value, particularly given the significant declines in key commodity prices. A lower exchange rate is likely to be needed to achieve balanced growth in the economy.

For the past year and a half, the cash rate has been stable, as the Board has taken time to assess the effects of the substantial easing in policy that had already been put in place and monitored developments in Australia and abroad. At today's meeting, taking into account the flow of recent information and updated forecasts, the Board judged that, on balance, a further reduction in the cash rate was appropriate. This action is expected to add some further support to demand, so as to foster sustainable growth and inflation outcomes consistent with the target.

Friday, January 23, 2015

How to Earn 4.02% While Shopping for a House

Statistics in Australia suggest that there is an increasing number of first home buyers who refuse to be drawn into the Australian real estate market because they are convinced that the house prices are not going up in a hurry. Consequently, many are sitting on savings of around $150,000 as they take their time finding a home. So what should one do with the savings?

Most good online saving accounts give you just under 3% interest. Bankwest Telenet Saver account is offering 2.50% at the time of this publication and UBank's Usaver account recently dropped their intereest rate to 2.96%. Most people looking for a home won't want to lock their money in a term saver account and even if you do, banks offer around 3.50%.

I found out recently that UBank offers 4.02% if you open a UBank Saver Ultra Account. This account gives you an everyday transaction account which is a first for UBank. It comes with a debit card with a sweep facility which moves money OUT of that transaction account when your balance goes over (minimum $1000) and moves money IN to the transaction account when your balance falls under a certain amount (eg $100).

This means that you can earn more interest on your savings without having to log in and move money every month/year. So why bother? Doing this could increase your interest earnings by 36% (comparing UBank USaver's 2.96% with USaver Ultra's 4.02%). The only condition is that you deposit $200 or more into the USaver account each month. Anyway, over to you. If you have a better offer you know of, please leave a comment.

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