Bottoming out
The worst of the housing market conditions are behind us, says CoreLogic.
Price declines are bottoming out in Sydney and Melbourne, though they've now spread to parts of Brisbane and most of the other capital cities, and almost all of the regions too.
Source: CoreLogic
And rental yields have recovered to a more sensible level.
The credit cycle having bottomed makes sense with what stock markets are telling us, with a raft of strong leads from consumer discretionary stocks and a solid recovery for the major banks.
It rather depends how you define 'worst', though, I guess, as transaction levels have been blown to smithereens.
UBS reported that housing turnover rate has collapsed to the lowest level on record at just 3 per cent.
So although price declines might be bottoming out, this bodes horribly for renovations and consumption.
Banks are quietly pleading for more leeway to lend.
Interest rate buffers and floors are indeed supposed to be updated to reflect the interest rate cycle and interest rate forecasts...though when the guidance was drafted financial markets were expecting the next move in interest rates to be up - which is no longer the case.
CoreLogic's full report can be found here.
