November Property Market Update
November Continues Increase of National Property Values
National dwelling values have experienced a positive trend since July and have increased again by 0.8% this November, bringing the national median dwelling value to $565,474. Regional values performed twice as well as their capital cities, growing 1.4% compared to 0.7% respectively. (Lawless, 2020)
Similarly, house dwellings are outperforming unit dwellings due to challenging rental market conditions. However, it is important to note that Sydney and Melbourne are the only regions in which unit prices are behind pre-COVID price points – down 0.2% and 1.2% respectively. (Conisbee, 2020)
Forecasts predict that with an active economy, decreasing unemployment rates, and COVID cases at bay, dwelling prices will continue to grow in 2021.
Demand is Strong Despite Seasonal Taper
Since the economy has reopened Australia wide, confidence in the property market has been replenished. People who experienced financial stability during the pandemic have saved more than ever before due to lockdowns and border closures restricting expenditure. Now it is evident that those eager to jump back into the property market haven’t wasted any time doing so.
As of 25 November, Realestate.com.au’s Weekly Property Demand Index* was 38.1% higher nationally than it was in 2019. High sales volumes are expected to continue to the end of 2020 even though demand will naturally taper towards the holiday season.
The rental market is following suit, weakening little by little as we approach the holidays. Despite many COVID-induced challenges weakening demand, such as international border closures and first-time homebuyer incentives, the rental market has still managed to record a Weekly Rental Demand Index^ 22.6% higher than it was this time last year.
November Trends Inspire Optimism
Promising Vaccine Trials
Organisations across the globe have been hard at work to find an effective coronavirus vaccine. One could soon be available – possibly from Oxford University who claim their vaccine trials have been 90% effective.
In fact, Australia has already purchased 30 million doses and regulatory approval is underway. Although vaccines are still a long way from being internationally available, this news provides hope that our pre-COVID world is possible, inspiring a further lift in consumer confidence.
State Governments Step Up
State governments are stepping up with strategies and grants to help boost the property market and local economies. Namely, New South Wales and Victoria made recent announcements about stamp duty relief. New South Wales has proposed to phase out stamp duty and replace it with a more manageable, annual tax scheme. Meanwhile, the Victorian government has announced it will grant up to 50% off stamp duty for dwellings valued up to $1 million for the rest of FY 2021.
Wrapping it up
November marked another overall positive month for the Australian property market. Government efforts are proving effective in stabilising our economy in the face of COVID-19 and property prices have continued to bounce back. Plus, demand remains strong despite an inevitable taper as we approach the holidays. Provided Australia can keep the virus under control and our economy continues to stabilise, Australian property owners should be optimistic about what 2021 has in store.
If you have questions about the process of selling privately, call our Private Property Specialists today on 1300 289 697. We're always happy to help.
- * Weekly Property Demand: Number of high-intent buy listing interactions on realestate.com.au indexed against a long-term cumulative average. *LTA calculated as cumulative average since Jan 2017 (Kusher, 2020)
- ^ Weekly Rental Demand: Number of high-intent rental listing interactions on realestate.com.au indexed against a long-term cumulative average. *LTA calculated as cumulative average since Jan 2017 (Kusher,2020)
- Conisbee, N. (2020, November 23). Chief Economist Update: Apartment Buyers Must Strike Now. Retrieved December 02, 2020, from https://www.realestate.com.au/insights/chief-economist-update-apartment-buyers-must-strike-while-the-iron-is-hot/
- Conisbee, N. (2020, November 25). Why November Marks a Turning Point for the Economy (and House Prices). Retrieved December 02, 2020, from https://www.realestate.com.au/insights/why-november-marks-a-turning-point-for-the-economy-and-house-prices/
- Heagney, M. (2020, November 24). Victorian budget: Stamp duty for new homes to be reduced by 50 per cent. Retrieved December 02, 2020, from https://www.domain.com.au/news/victorian-budget-stamp-duty-for-new-homes-to-be-reduced-by-50-per-cent-1008968/
- Irvine, J. (2020, November 18). Abolition of stamp duty in NSW is a bold and welcome policy. Retrieved December 02, 2020, from https://www.smh.com.au/business/the-economy/abolition-of-stamp-duty-in-nsw-is-a-bold-and-welcome-policy-20201118-p56fse.html
- Kusher, C. (2020, November 19). Strong Consumer Mindset a Boon for Housing This Festive Season. Retrieved December 01, 2020, from https://www.realestate.com.au/insights/strong-consumer-mindset-a-boon-for-housing-this-festive-season/
- Kusher, C. (2020, November 25). November 25 REA Insights Weekly Property Demand Report, 2020. Retrieved December 02, 2020, from https://www.realestate.com.au/insights/november-25-rea-insights-weekly-property-demand-report-2020/
- Kusher, C. (2020, November 25). November 25 REA Insights Weekly Rental Demand Report, 2020. Retrieved December 02, 2020, from https://www.realestate.com.au/insights/november-25-rea-insights-weekly-rental-demand-report-2020/
- Lawless, T. (2020, December 01). CoreLogic November home value indices: Dwelling values rise across every capital city and rest-of-state region. Retrieved December 02, 2020, from https://www.corelogic.com.au/news/corelogic-november-home-value-indices