Strong Rises in values of Coastal Perth

by joy.manginsay 29. February 2012 18:09

According to the Real Estate Institute of Western Australia (REIWA), strong rises in values of coastal Perth suburbs have led a resurgent WA housing market, North Beach, north of the Perth CBD was the strongest-performing suburb over December. Rossmoyne, the Canning River tot eh South of the CBD was the second suburb performs double than the 7.3% increase. Ocean Reef was followed on the list in which in the outer-northern suburbs where prices increased by 4.5%.

According to REIWA President David Airey, “The modest increase in Perth’s median house price is due to the growing numbers of up-grade buyers who entered the market, particularly in the $500,000 to $700,000 price range.” If we observe market indicators, buyers and sellers are more confident, Perth house price increase because of the number of properties decline and Perth was one of the more volatile housing markets last December 2011.

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Perth and Brisbane: Surge Demand Drive

by joy.manginsay 28. February 2012 19:12

Based on the Property Council of Australia reported last February 2012, a surge in demand in Perth and Brisbane helped push Australian office vacancies to a three year low. Vacancies in Perth’s center more than halved to 3.3% while in Brisbane fell to 6.2% from 7.4%.

According to Sydney-based Regional Director for office services at property broker CBRE Inc, James Patterson said, “Perth and Brisbane outperformed expectations with the resources sector continuing to expand strongly in both cities.” Brisbane and Perth are tenant demand in which the two cities are given strong mining employment growth and re-assured that there will continue benefited on the flow-on to domestic economy.

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Australian Growth: not as strong in 2011

by joy.manginsay 27. February 2012 18:18

According to the latest Reserve Bank of Australia (RBA) monetary policy meeting showed, “Growth in the Australian economy was not as strong in 2011 as experts had predicted. Last December quarter, inflation stood at 0.5%, which was broadly in line with the expectations. The main source of growth in 2011/12 is expected to be a 16%/year surge in private business investment and 3.5%/year growth in household consumption. A number of factors contributed to the less-than-expected 2.75% growth seen and different industries adjusted to high trading terms and exchange rate.

Perth Median Price Increase

by joy.manginsay 24. February 2012 19:48

According to REIWA quarterly figures, the median house price at December 2011 was $462,000 up from $450,000 in September. REIWA reported that the average number of selling days peaked in September at 79, falling slightly to 77 in December, this report showed down sharply on the market.

Although, this past year, there was a decline in residential prices but based on the survey, the Perth median price has stabilized and started to record growth in the past quarter, but the rent may increase because of the tight rental market and oversupplied of house that put pressure on rental levels. Median house rents showed $425 a week as at December, up from $380 a week the previous year. It showed that median house rents continue to increase and expected to continue increasing.

Behind Interest Rate On Hold

by joy.manginsay 23. February 2012 18:18

RBA announced that Interest Rate still on hold in which Investors and Analysts were disappointed. The RBA’s decision to not reduce rates this month was surprising to everyone because Analysts predicted Interest rate cut this month. The RBA’s explanation for its decision shows that it is making a rosy call of both the current data and the direction in which at the Australian Economy is headed. The Australian Economy continues to suggest growth close to trend. Unemployment rate increased and inflations is around 2.5% and Banks expects inflation to be in 2.3%. Economists and Analysts still expecting that RBA must drop interest rates by at least 0.5% and probably more.

Australian Strong Performance Economy

by joy.manginsay 22. February 2012 21:23

According to HSBC Chief Economist Paul Bloxham, Australia (RBA) will make further readjustments to interest rates and even if these are not passed on to the Aussie on the street by the major banks, the RBA will keep the cast rate on hole at 3.75%. The Australian economy is in a strong position and the expected interest rate cuts to the following months will help to boost the retail and housing sectors. One of the sectors that make Australian economy become strong is the ongoing mining boom that helps to stand the country in a good stead. Analysts had predicted that RBA would be influence by all sectors and the economy in which RBA has the firepower to use monetary policy. Because of the boost economy, the country will get ready for the future.

Australia REIT: Strongest in Asia Pacific 2012

by joy.manginsay 21. February 2012 18:11

Analysts stated that Australian Property trusts are likely to deliver a total return of 12-15% this year, outperforming local equities and other Asia-Pacific markets. Although Australian equity markets remained weak but Australian benefited the A-REIT sector for the next 6-12 months because Australian REITs performs better than the broad market because any local and foreign investor have more confidence to invest and focus to gain income than the capital gains.

According to Simon Garing, Analyst of Bank of America Merrill Lynch, “We expect they (ASIAN REITs) will continue to underperform for the first half of the calendar year. Australian REIT’s have been sort of a safe haven.” A-REIT sector currently offers a dividend yield of 6.6% and Australian Central bank was expected to cut rates to stimulate the economy.

ANZ Banking Group Increase Interest Rate

by joy.manginsay 20. February 2012 18:13

Australian and New Zealand Bank announced last 10th February 2012 that it will increase interest rates for variable rate mortgages and small business lending by 0.065. We remember that last December, ANZ was the only bank who passed Interest rate Cuts and unfortunately the Interest rate cut didn’t happen. ANZ’s decision regarding this review, really increased competition among banks for consumers and business deposits. Effective last 17th of February 2012, ANZ’s new standard variable mortgage rate was 7.36%pa. The intense pressure on retail and business margins are one of the considerations why ANZ came up this decision and also because of the increased competition among banks for consumer and depositors.

WA remained Strongest State:NAB

by joy.manginsay 17. February 2012 19:07

National Australian Bank (NAB), February 15, 2012 released its Quarterly Australian Property Survey and it showed WA remained the strongest state now and over the next 2 years. Commercial Property Index still negative territory with (-6 points), but it was a slight improvement from (-13 points). WA led the entire commercial property sector including office, retail and industry segments and it’s proven by the survey that Australia’s CBD hotels and office was currently strongest in today’s conditions. According to the survey, conditions were strongest in WA but a biggest turnaround is expected in Queensland. Victoria is the weakest state as identified the very weak retail property market. WA particularly Perth are home to major international companies in which one of the factors why the state is remained strong.


 

Commercial Property Survey Summary (Dec-2011) (2).pdf (200.94 kb)

Positive Signs in Property Market

by joy.manginsay 16. February 2012 17:58

According to Rismark’s Christopher Joye, “We are counting almost 300,000 homes advertised for sale across Australia, which is more than 30% higher than the same time last year.” The large of number of properties available for sale implies buyers will continue to hold the balance-of-power at the negotiation table. Australia’s housing market may be starting soft and turn the corner. Nowadays, vacancy is tight and rents growth is now accelerating. Because of the trade and home buyers entered into the market, sales volume improved with reasonable price. Consumers’ confidence is more optimistic now compared last year and consumer still hoping that there will be interest rate cut. Indeed, property market looks positively competitive and strong that makes extreme volatility.


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