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The Week In Real Estate 19 November 2022

Quote Of The Week

“This is a permanent change and someone wanting to refinance every three to four years is something brokers need to get used to and something they need to tap into.”

Trail Homes founder Nick Young, commenting on the rise of re-financing activity.

Refinancing Volumes Hit $33 Billion

Refinancing Volumes Hit $33 BillionThe number of home-owners looking for better deals and refinancing their mortgage has risen rapidly, according to new figures from the Australian Bureau of Statistics.

The figures show that refinancing volumes increased from $16.3b in May 2020 to $33.2b in January 2022.

According to Trail Homes founder Nick Young, mortgage brokers are reporting that while new loan numbers are down, they are helping plenty of existing clients who are looking to refinance.

He believes now that homeowners have become comfortable with refinancing, it is a trend which will remain.

“This is a permanent change and someone wanting to refinance every three to four years is something brokers need to get used to and something they need to tap into,” he says.

He predicts a further 10% increase of people refinancing through mortgage brokers is to come in the next year.

Young says lenders continue to try to lure new borrowers with incentives such as cash back offers.

High Demand Pushes Up Student Rents

High Demand Pushes Up Student RentsLow vacancy rates and high demand from students for the 2023 academic year have resulted in an increase in student accommodation rents.

Student accommodation provider Scape says rents are already 10% above pre-pandemic levels and many of their properties are already committed for next year.

Property Council of Australia executive director of the Student Accommodation Council, Torie Brown, says many operators are reporting similar demand.

A Property Council report into student accommodation shows foreign student numbers will lift from 521,000 this year to 699,000 by 2027.

It predicts the national total of purpose-built student accommodation will grow to 93,300 beds by 2025.

Students from China have the largest marketshare of students using the accommodation (27%), followed by Australian students (26%), Indonesia (5%), India (4%) and Malaysia (4%).

Tight rental markets have increased the number of Australian students seeking purpose-built student accommodation.

The report says for the sector to grow further it needs a reduction in barriers to investment.

Low Vacancies Will Halt Price Decline

Low Vacancies Will Halt Price DeclineLow vacancy rates and a looming increase in demand from international migrants are set to offset any softening of house prices, according to REA Group which owns

It says prices have softened in some locations in 2022, but the rental shortage crisis means there is unlikely to be a big drop in price levels.

REA chief executive Owen Wilson says house prices nationally are down about 5% but remain well above pre-pandemic levels.

Softening prices in some markets have resulted in a small drop in the number of people searching for properties on

“Customers are telling us that every time rates go up vendors tend to pause on their thinking about bringing their properties to market and buyers definitely pause as they reconfirm their buying capacity after each rate rise,” he says.

Wilson says a few things will keep house prices stable, including the predicted influx of more than 200,000 migrants which will come to Australian within the next year, all needing somewhere the live.

Auction Activity Rises, 60% Sold

Auction Activity Rises, 60% SoldCapital city auction activity rose by almost 13% in the past week with 2,159 homes put under the hammer.

Despite the increase in properties taken to auction, CoreLogic says preliminary clearance rates are down by 3.6% on the previous week at 60.1%.

Sydney had its busiest auction week since last September with 786 homes offered for auction and a clearance rate of 60.9%.

Activity increased in Melbourne, with 920 homes taken to auction and a clearance rate of 60.1%, the sixteenth consecutive week of a clearance rate in excess of 60%.

Brisbane auction activity as up by a third (31.5%) on last week, with 171 properties offered for auction and a clearance rate of 41.8%.

Adelaide’s activity was down slightly with 149 auctions and a clearance rate of 68.6% while Canberra was steady with 112 auctions and a clearance rate of 59.7%

CoreLogic’s Tim Lawless says the figures suggest sellers are still cautious about attracting bidders in the current market.

Listing Numbers Start To Rise

Listing Numbers Start To RiseProperty buyers had more to choose from last month, with new figures showing listings increased in nearly every part of Australia.

PropTrack data shows new listings in capital cities were up by 8.8% month-on-month in October, while in the regional markets new listings were up 0.8% month-on-month.

The figures resulted in a national increase of listings of 2.4%.

Despite the monthly increase most capital cities had fewer new listings this year compared with last year, particularly Sydney and Melbourne.

Hobart is the only capital city to have more properties listed for sale this year than last year, up 26.5% year-on-year.

Listings also remain subdued in many regional areas with the number of properties being offered for sale less than would normally be expected at this time of the year.

New listings were up by only 0.8% month-on-month in October and down 12% compared with this time last year.

Sydney and Regional Queensland recorded small drops in listings in October.


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