Proptech funding

BuyersBuyers

Check out an article on our recent proptech capital raise here (or click on the image below):

You can find out more about our services here.

There's more to come in terms of our free market research tools, the digitisation of the property purchase process, broker portals, and much more besides thanks to our top team tech experts, so watch this space. 

Investor credit growth turns positive

Credit growth picks up...for housing

Housing credit growth picked up to 4.8 per cent in May 2021, which is stronger but well behind the growth in incomes for the property buying cohorts this year. 

The credit impulse implies strong growth, and will likely be reflected in 12 per cent growth price growth over the year to June for the capital city markets. 

Investors have largely been sidelined since 2017, but credit growth has now finally turned positive in this segment, albeit at just 1.6 per cent growth over the year to May. 

Total investor credit is broadly unchanged over the past two years, as more loans have rolled off interest-only terms, which average mortgage rates have declined sharply.

Business credit growth and personal credit growth were positive in May, but only just, and were both lower over the year. 

Total credit growth was very weak at just 1.9 per cent, well down from 3.2 per cent a year earlier.

Overall, property investors should be expected to take over from first homebuyers in driving the market from H2 2021. 

The Top 10 Investing Books

Top 10 books

We review the top 10 investing books of all time, starting with Shiller and Hagstrom.

Tune in here (or click on the image below):

You can listen to the whole podcast back-series on Apple here.

You can also tune in to the full podcast series at Soundcloud, Stitcher, or Spotify.

You can download our new e-book here.

Don't forget to leave us a friendly review, as it helps us to get the word out!

COVID and property: what now?

COVID and property

I discussed what comes next with Annette Beacher at ausbiz TV.

Tune in here (or click on the image below):

The Big Picture podcast

Big Picture podcast

Some interesting stuff here, including changes to mortgage rates, and lending standards.

Tune in here (or click on the image below):

Funding round complete

Buyer's agency services

Via Smart Property Investment (or click on the image below)::

From V-shaped recovery to Nike 'swoosh'

Jobs swoosh higher

Skilled vacancies rose again in May, according to the Department of Employment's labour market information portal, up by 1.9 per cent over the month to a thumping 245,500.

From a year earlier, advertisements are up by a massive 164 per cent.

There have been some huge year-on-year increases of more than 200 per cent in Victoria and Tasmania, although all states and territories have recovered very well indeed.

In Queensland, vacancies continued to rise solidly in May, accounting for most of the gains.

Net interstate migration into Queensland exceeded 30,000 in 2020 for the first time since 2005.

Queensland's skilled vacancies are now 56 per cent higher than pre-COVID levels, with all states recording substantial improvements. 

The V-shaped recovery is turning into a satisfying 'swoosh'.

Australia tops median household wealth

Global wealth

Credit Suisse released its Global Wealth Report for 2021.

With a median net wealth per adult of US$238k Aussie households were measured to be the wealthiest in the world in 2020, ranking ahead of Hong Kong, Singapore, Switzerland, Japan, and all the rest.

Source: Credit Suisse

Australia's mean wealth per adult was also exceptionally high at US$439k, ranking behind only Switzerland, the U.S., and Hong Kong.

Switzerland and Australia saw the biggest increase in wealth over the past year, while the composition of Aussie household wealth is essentially unchanged over the past two decades. 

Australia's housing stock is overwhelmingly and increasingly owned by private households, with only a small share of dwellings accounted for by public housing, in contrast to elsewhere. 

This also partly accounts for the relatively large stock of household debt in Australia. 

The number of Aussie millionaires increased from 1.4 million to 1.8 million in 2020 (and is expected to increase to 3.1 million by 2025), as asset prices rise.

Only Switzerland had a great density of millionaires than Australia (Monaco probably does too, if anyone knew how to measure those figures). 

Jobs report puts RBA on notice

Dovish stance

I discussed the latest jobs figures with Annette Bleacher at ausbiz TV here (or click on the image below):

Podcast mini-series: The Top 10 books on investing

Top 10 investment books

A new min-series on our Low Rates High Returns podcast: the top 10 books on investing.

Tune in here (or click on the image below):

You can listen to the whole podcast back-series on Apple here.

You can also tune in to the full podcast series at Soundcloud, Stitcher, or Spotify.

You can download our new e-book here.

Don't forget to leave us a friendly review, as it helps us to get the word out!

Auctions revised down

Hammer time

Melbourne's final auction clearance rate was revised down to 61.7 per cent through the lockdown disruption.

The final result for Melbourne this week will also likely land somewhere in the 60s.

Another solid result for Sydney today, despite the very high number of listings:

Source: Domain

I discussed here yesterday how Victoria's population began to decline in from June 2020 onwards, as folks moved interstate to escape restrictions.

Louis Christopher of SQM Research made an interesting counterpoint, highlighting how high vacancy rates in inner-city Melbourne have begun to fall.

There could be a number of explanations for declining vacancy rates: the population may no longer be decreasing, units could be filling up in the CBD, Docklands, and city fringe due to lower advertised rents, or perhaps investors are selling up their rentals. 

Maybe it's simply a combination of factors. 

One to watch as the year progresses.

Locked down Victoria sees population decline

Negative growth for VIC

All of the Australian states have experienced an obvious decline in population growth due to tight international border controls...but Victoria's experience has been next level.

Annual population growth in Victoria has slowed from a peak of nearly 154,000 in 2017 to just 745 for the calendar year 2020. 

Indeed, in the second half of 2020 the state's population declined by approximately 35,000, and given there have been further lockdown restrictions in 2021 it's quite likely that this trend has persisted. 

It's not too hard to see what's happened when you look at net interstate migration.

Whereas folks were previously moving to Melbourne for work, now there has been a surge of Victorians relocating to south-east Queensland. 

Net interstate migration to Queensland exceeded 30,000 in 2020 for the first time in 15 years, and the numbers really exploded in the December quarter with conspicuous Victorian licence plates being spotted all up and down the Queensland coast, so there's quite likely more in the post.

Queensland had by far the fastest population growth rate in 2020 at 1.1 per cent, or +58,100 persons.

With Victoria experiencing 0.0 per cent population growth it becomes clear why the bulk of rental vacancies are in inner-city units in Melbourne (and to a secondary extent Sydney). 

Across much of Australia rental vacancy rates are running at record lows, partly because people have been leaving Victoria in droves to escape the on again/off again lockdown policies and restrictions on movement. 

Employment surges again

Employment hits record

The labour force report trounced expectations, with employment rising by a massive 115,200 in May 2021 to a record high of 13,125,100.

Full-time employment overwhelmingly accounted for the May gains. 

There were some quirks in the data, including from sample rotation, and this did come off the back of a negative print in April. 

In fact this month's result got a huge kick from the sample rotation, which will effectively act as a drag on the growth in reported employment over the next 6 months. 

A more sanguine view shows that employment increases solidly by +153,800 over the past quarter, which might be a more realistic guide as to the pace of employment gains. 

The unemployment rate took a very significant drop, all the way down to 5.07 per cent, though there is still a way to go before full employment. 

The unemployment rate peaked at 7.45 per cent, but has recovered quickly. 

At the state level New South Wales has now seen total employment recover in full, bouncing by +308,000 from a year earlier, taking the state unemployment rate back down to 5 per cent.

Employment has also surged to a record high in Queensland, but with by far the fastest population growth in the country - at 1.1 per cent thanks to surging interstate migration from Victoria - there is still some slack in the Sunshine State, where the unemployment rate is 5.4 per cent. 

Hours worked were up 13 per cent from a year earlier, due to the base effect, which outpaced the 8 per cent growth in employed persons. 

Overall, another very promising result, although not quite as strong as it looked at first glance.

The Reserve Bank acknowledged the lumpy nature of the recovery and will commit to further bond buying, while again noting that the conditions for an increase to the cash rate are unlikely to be met until 2024 at the earliest (and in some scenarios, the conditions may still not be met during 2024). 

Rental vacancies tighten

Rental vacancies tighten

Rental vacancies across Australia continued to decline in May, down from 1.9 per cent to 1.8 per cent.

Rental vacancies have dropped very sharply from a year earlier, when the national rental vacancy rate was 2.5 per cent. 

Sydney's vacancy rate dropped from 3.1 per cent to 2.9 per cent in May, while Melbourne was still by far the most elevated at 3.7 per cent.

It remains to be seen what Melbourne's latest lockdown will do to unit vacancies.

Brisbane declined again to a 1.3 per cent vacancy rate, now well down from 2.5 per cent a year earlier.

All other cities saw very low vacancy rates of under 1 per cent in May, especially Darwin (0.4 per cent) and Hobart (0.5 per cent).

Vacancy rates in the Sydney and Brisbane CBDs have declined very sharply from last year's highs according to SQM Research.

Some vacancies appeared on the northern NSW coast, as a cohort of renters moved back to town. 

Many regional centres continue to tighten, from Mornington to Gold Coast.

Resi prices up 5.4pc in Q1

Resi prices up

The median dwelling price across the 8 capital cities rose strongly by 5.4 per cent in the March quarter.

House prices have, on average, outperformed attached dwellings since 2003, though all dwelling types reached new highs in March 2021. 

Sydney and Hobart prices rose 6.1 per cent in the March quarter, with significant gains recorded across all of the capital cities. 

The mean dwelling price in New South Wales increased by $115,300 over the past year to breach $1 million for the first time.

The mean dwelling price remains below previous highs in the Northern Territory and Western Australia, but all other states and territories recorded new highs, as expected.

Prices have continued to increased at a sprightly pace in the second quarter too.

You can find some more detailed analysis with James Foster here.

The 4Fs Model mini-series #7: Running your own financial race

Podcast Episode #50

We discussed the final part of our 4Fs model in this week's podcast episode.

Tune in here (or click on the image below):

You can listen to the whole podcast back-series on Apple here.

You can also tune in to the full podcast series at Soundcloud, Stitcher, or Spotify.

You can download our new e-book here.

Don't forget to leave us a friendly review, as it helps us to get the word out!

Property: oversupply versus undersupply

Underbuilding or overbuilding?

We discussed here at the Property Buyer blog (or click on the image below):

Weekend reads

Must see articles

This weekend at Property Update, a look at how higher volumes are likely to persist through the quieter winter months, as well as the return of investors.

Click here to read (or on the image below):

You can subscribe for the free Yardney podcast here.