Adelaide leads
Brisbane, Adelaide, and Perth recorded solid gains in housing prices in April.
Hobart was down -0.3 per cent, Sydney was modestly negative at -0.2 per cent, and Melbourne was basically flat (or very slightly negative).
Capital city price growth decelerated to +0.3 per cent, with regional markets still outperforming at the end of April.
CoreLogic enlightens us all with the full report here.
Source: CoreLogic
The change in rents was strong and accelerating at +9 per cent over the year to April (a year ago, rents were also up +4.9 per cent).
House rents (+9.1 per cent) have somewhat outpaced unit rents (+8.7 per cent) over the past year, but something has now changed in this regard according to CoreLogic, with unit rents accelerating.
And, as expected, this is bringing some investors into the market at last:
Source: CoreLogic
Job ads peak
Job ads declined modestly by 0.5 per cent in April, according to ANZ, suggesting a possible peak in this data series as the stimulus fades.
Elevated job ads are still some 57 per cent above pre-pandemic levels, so there should still be strong hiring outcomes from here, even if sentiment in the economy cools in due course.
Inflation pressure eases
With headline inflation in Australia finally taking off to hit 5.1 per cent, the inflation Cassandras are now really out in force.
However as the inflation hysteria crescendoes, the time has nearly come to take the other side of that trade.
In fact, the Melbourne Institute reported negative inflation of -0.1 per cent in April, as fuel costs at the bowser have come back down.
As you can see in the rents figures above there are still certainly inflationary pressures around - and indeed the core MI inflation reading was still in positive territory - but either way the peak should soon be in for year-on-year headline inflation.
Denominator effect recedes
Part of the reason we can get such high inflation readings - such as we saw in 2008 - is that prices tend to be rebounding from a lower base after a recession or shock.
But that denominator effect will be behind us by the end of the year, suggesting lower inflation readings in time than we have been seeing.
Interestingly the US economy has already recorded negative GDP growth for the first quarter of the year, with fixed mortgage rates having increased sharply.
Supply chains tofind a way
We've been through a horrific confluence of disrupting factors from COVID-19 restrictions to Ukraine warfare which have driven supply-side inflationary pressures.
But one way or another these supply chain issues will ultimately right themselves.
Channelling their inner Hannibal, global supply chains "will find a way or make one".
And many of the disinflationary forces we've seen since the early 1990s have hardly gone away, further suggesting that inflation pressures will ease in time.
Central banks are inevitably beginning to tighten their policy settings, but it still seems dubious to me that the cash rate will get as far away from the zero lower bound as financial markets are pricing for.
In Australia, Reserve Bank commentary will be in sharp focus over the coming weeks.
More from Ross Gittins today on the subject here.
