Housing credit growth fastest since 2022

Investors jump in

Housing credit growth has 0.56 per cent in August, according to RBA statistics, for the fastest monthly growth in almost three years. 

This was mainly due to strong investor credit growth of 0.73 per cent, but I wouldn't be much surprised to see owner-occupier credit growth turning higher towards the end of the year as the first homebuyer deposit guarantee kicks into gear. 

The housing credit impulse thus accelerated for a third consecutive month, suggesting rising housing prices ahead.  

The wrap

Overall, while business credit growth has eased a little, mortgage demand is rising, while anecdotally many first homebuyers are looking to get into the market ahead of an anticipated rush in the final quarter of the year.

There have already been signs of more urgency among buyers in the lowest price quartile of the housing market. 

Previously Treasury has dramatically under-estimated the impact of FBT exemptions on novated leases and the over-subscribed HomeBuilder stimulus measures respectively - hat tip Justin Fabo of Antipodean Macro - so it probably wouldn't be a surprise if the deposit guarantee sees a similarly enthusiastic take-up over the year ahead. 

There may be a risk of negative equity for some first homebuyers down the track, though younger workers generally tend to find ways to make mortgage repayments. A more significant driver of mortgage defaults in recent times has been from property developers (while lenders have been more inclined to offer mortgage holidays to any struggling homeowners).

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Dwelling approvals slide further

Approvals pare back

Building approvals disappointed again in August.

The trend for house approvals was lower for the month, and for the year. 

Attached dwelling approvals in Sydney dropped to just 870 - a volatile data series - accounting for most of the monthly decline in approvals. 

The trend for Brisbane looks pretty solid, on the other hand. 

And, anecdotally, Melbourne zoning changes have helped to deliver some more projects in suburbia in recent times. 

Overall, there were just 14,744 approvals in August, another -6 per cent decline to follow a revised -10 per cent decline in July. 

Looking at the bigger picture, there were only around 189,000 dwellings approved over the year, at a time when population growth has been thunderously strong. 

Since July 2024, there have been approximately 218,000 approvals, about 78 per cent of the implied target of 20,000 per month. 

The wrap

It's hard to know where the trend for building approvals goes from here, but the past couple of months have obviously been a disappointment. 

The Reserve Bank of Australia delivered a fairly hawkish hold for interest rates this month, with the cash rate target remaining at 3.60 per cent.

Interest rates could fall further as and when the unemployment rate approaches 4½ per cent, but further easing in this cycle is by no means a certainty, as the decline in underlying inflation has slowed.

Given recent inflation and consumer sentiment data, market pricing isn't looking for a further cut until May next year (which ironically may actually slow down the housing supply response a little). 

Although there is a fairly sizeable pipeline of dwellings under construction, delivery of new housing supply remains slow and there is a serious prospect of Australia's housing shortage persisting into the next decade given recent trends in population growth. 

James Foster ran through the figures in more detail here. 

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My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

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2-Sense podcast: Significant shifts in the visa landscape

2-Sense podcast

This week on the podcast, Chris and I discussed Perth's ongoing undersupply of housing and what this means for the broader property market cycle.

We also discussed significant shifts in the visa landscape, and where sellers are making the greatest gains (Kiama in NSW) and losses (sales of apartments bought off the plan). 

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

You can also watch the YouTube version here:

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You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,300 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here.

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

Job vacancies point to rising unemployment

Job vacancies in decline

Job vacancies increased in the public sector again in the 3 months to August, but private sector job vacancies fell by -3.4 per cent.

Overall, job vacancies fell by -2.7 per cent to 327,200, to be about one third below the peak of 475,000 some 3 years earlier. 

Queensland continues to be the standout economy, with jobs vacancies in the Sunshine State increasing to 71,400, even though there are some regional jobs being lost in the coal mining industry. 

New South Wales also saw a small increase to 98,100 vacancies. 

Overall, however, vacancies are easing, with Victoria (or -7,300 or -8.8 per cent) experiencing the greatest drop. 

At this stage, there are still only a couple of unemployed persons per job vacancy. 

That said, the trajectory of job vacancies as a share of the labour force suggests that the unemployment rate will continue to rise from here towards 4½ per cent, and probably beyond. 

As corroborative evidence, some random guy on X Tweeted me the below indexed chart of SEEK job applications per advert. 

Source: Some random guy on 'X'

Overall, though labour market dynamics may have shifted a little since the pandemic, it looks as though the unemployment rate will rise in most states and territories ahead. 

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Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,300 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here.

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

Last one out, switch off the lights!

Electricity price 'shock'

During the 2022 election campaign, Albanese pledged that Labor would reduce household energy bills by $275 by the end of the first electoral term in 2025. 

Meanwhile back in the real world, as bills surged by much as 40 per cent over the two years to June - in so doing blazing to as much as $1,000 above the promised level - instead we've seen the government offering household rebates to take the edge off cost of living pressures. 

Small businesses have seen even more chronic increases in power bills, often exceeding $2,000.

In monthly terms, electricity costs were down -6.3 per cent in the month of August thanks to rebates in New South Wales and the Australian Capital Territory. 

However, over the 12 months to August, electricity costs were some 24.6 per cent higher, with rebates having concluded in Queensland, Western Australia, and Tasmania.

Stripping out the impact of the rebates, costs were 5.9 per cent higher over the year, with the 2022 election pledge having long since been blown out of the water and/or consigned to the dustbin, depending upon your preferred analogy. 

In August overall, the consumer price inflation was only -0.1 per cent, but as expected was higher at 3 per cent over the year due to base effects.

Trimmed mean inflation slowed only slightly from 2.7 per cent over the year to July, to 2.6 per cent over the year to August. 

Source: ABS

Insurance costs were up again, however, while dwelling price inflation was back on the up too.

It had looked as though trimmed mean inflation for the September quarter might be around 0.75 per cent or below, but there may prove to be some upside risks based on these numbers. 

Markets are taking a fairly reserved view at this stage on the need for further monetary easing, with OIS pricing now looking at the November 2025 central bank meeting as an each-way bet for an interest rate cut. 

A couple of further cuts are still expected for this easing cycle. 

James Foster ran through the monthly inflation release in more detail here. 

---

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You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,300 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here.

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

Nosebleeds

Nosebleed valuations

Been on the plane for the past day or so - from Europe to Perth - so just been chilling with the kids today, ahead of the AFL grand final in Melbourne next week.

I somehow expected there to be a bit of construction going on in WA, given the mega-housing-price-boom of the past half-decade or so...and yet, nothing much seems to have changed since last time I was here. 

With so few foreign buyers in the market these days thanks to stamp duty surcharges, it seems that apartment developments - and therefore the supply response - remain fairly stymied so far in this housing cycle. 

Not so much time for blogging today, so just a quick chart or two instead.

Here's the first one - the Shiller PE (CAPE) ratio has risen to above 40, the second most expensive level in history:

It's pretty amusing, actually,  since only a few months ago back in April there were a lot of articles about the potential destruction arising from Trump's proposed tariffs and the end of US exceptionalism.

This is just one measure of stock market exuberance, granted, but there are plenty of others you can look at.

Here's the Price to Sales ratio, by way of a second example, which is trading at the highest level in history:

In short, after a blistering run, stock markets are trading at incredibly expensive levels.

John Hempton of Bronte Capital discussed how extreme the market exuberance is in a recent Partner Letter in June 2025 here.

And stock markets have shot almost straight upwards since then.

Strap in.

Back to sleeping off the jetlag - normal blogging services will resume forthwith...

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Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,300 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here.

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

2-Sense podcast: Could fires and floods sink Aussie property?

2-Sense podcast

This week on the podcast Chris and I discussed the following hot topics. 

• Story 1 – Grandparents driving up luxury unit prices in their favourite suburbs 
• Story 2 – Climate change could wipe $500bn from property values!
• Story 3 – First homebuyers pounded by soaring prices

And we also went through your questions in the listener Q&A.

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

You can also watch the YouTube version here:

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 1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,300 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here.

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

Housing shortage set to worsen further

Migration to pick up pace

Australia's population grew by +144,238 or +0.5 per cent in the March 2025 quarter, driven by a very strong figure for net overseas migration. 

Over the year the estimated resident population increased by +423,400 or +1.6 per cent. 

Source: ABS

Looking around the traps, the strongest percentage population growth was still to be found in Western Australia at +2.3 per cent.

There was also very strong absolute population growth over the year in Victoria (+124,600), New South Wales (+101,800), and Queensland (+98,600). 

The slowest population growth was seen in Tasmania, at +0.2 per cent, or +1,100 over the year.

Source: ABS

These figures only run to March 2025. 

However, as Dr Alex Joiner of IFM Investors shows in the graphic below - while we can't say for certain - the monthly arrivals and departures figures produced by the ABS suggest that immigration has most likely reaccelerated throughout 2025 year-to-date.

At a time when housing supply is being delivered at an underwhelming pace, it looks as though the housing shortage will therefore worsen. 

The estimated resident population of Australia as of today is a little higher and growing a bit fsater than previously estimated, at around 27¾ million, with an extra person being added every 61 seconds, on average.

---

 1. Download our property buying guide

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You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,300 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here.

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

Hand-off to private sector employment fails to launch

Jobs growth stalls

The labour force survey for the month of August 2025 was disappointing, with employment falling by -5,400, seasonally adjusted, including a -40,900 fall in full-time employment.

Hours worked also contracted by -0.4 per cent over the month.

The 3-month average for employment growth fell to just +7,700, now tracking far below the level consistently required to hold the unemployment rate down.

There was also a significant decline in the participation rate in August, however, from 67 per cent to 66.8 per cent, and as such the unemployment rate held at 4.24 per cent, seasonally adjusted, though the trend has evidently been running higher for most of the past three years. 

Somewhat surprisingly, the underemployment rate dropped back to just 5.7 per cent, well below the 6½ per cent seen a year earlier. 

Overall, though, this was a pretty weak result, with little concrete evidence to date that private sector employment growth is going to take over adequately from the public sector. 

The Aussie dollar initially pulled back from 66½ US cents to around 66.35 cents on the release, reflecting the weaker than expected news. 

Financial markets are pricing a 25 basis points interest rate cut for November, and a further cut in 2026.

James Foster ran through the key details here. 

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 1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,300 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here.

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.