Hotspotting
CoreLogic is one of Australia's leading sources of data on residential real estate matters, although increasingly overshadowed by other, smarter data organisations like PropTrack. CoreLogic has lots of statistics about housing markets but when it comes to analysis and commentary, CoreLogic is very often a source of illogic. Their problem, like so many companies that comment on Australian housing markets, is that they employ economists to analyse real estate and the outcome very often is kindergarten analysis. Here’s a recent example: According to , property markets outside the capital...
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Perth is moving into a new phase in its property boom, with more and more buyers opting for units as houses become more and more expensive. The latest sales data shows that the strongest markets in Perth are well-located locations with a major presence of attached dwellings. While the most popular house markets for home buyers and investors (mostly those at the affordable end of the market) are a little less buoyant than earlier in the Perth up-cycle, the focus is switching to affordable units. Perth started this boom with a reputation as the most affordable capital city housing market. After...
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Adelaide’s property market, one of the nation’s strongest in the past two years, has strengthened further recently. ales volumes shows that market activity in the June quarter was the highest for Greater Adelaide since mid-2022. The June Quarter sales levels represented a 25% increase on the March Quarter and were 10% higher than the same time last year. This is despite the reality that listings of homes for sale across Adelaide are the lowest at any time in the past 15 years, according to SQM Research figures. This continues Adelaide’s track record as a market with consistently...
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One of the greatest misconceptions in the housing market is that property investors are the people who cause property prices to rise. The evidence confirms that this is a major piece of misinformation but some sections of politics and news media love to perpetuate this fiction. And, as an extension, use it as justification for advocating the end to negative gearing. Some people appear to believe that eliminating negative gearing tax benefits will fix all the problems in the property market: rising prices, housing affordability generally, the shortage of new homes, the rental crisis, pretty...
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The trend we call the Exodus to Affordable Lifestyle is among the most powerful forces impacting real estate markets across Australia. It’s a trend that been around for at least the past 10 years, with more and more residents of the biggest cities relocating to smaller cities or regional areas in search of a different and more affordable lifestyle, empowered by technology which allows many people to work remotely. It was NOT created by the Covid lockdowns. It was under way long before Covid appeared in 2020 and it continues to have considerable momentum now that we are well beyond the...
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Top economists are unanimous in believing Australia's housing market is in crisis, according to a new poll. And I have to say, Wow, we had to go to a group of “top economists” to achieve that startling revelation. It comes from a survey in which the Economic Society of Australia offered these top economists a choice of 14 measures identified by as likely to restrain prices for buyers and renters – in other prevent property prices and rents from continuing to rise. Therein lies the first problem: they polled economists rather than real estate experts. If there’s one thing we’ve learnt...
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A question I get asked more than any other is where I see the Australian property market heading in the next 12 months OR what I expect to happen with Australian property prices this year or next year. And the answer I provide is usually delivered in multiple parts. Firstly, there is NO Australian property market. Although economists and journalists often refer to “the Australian property market” and predict what will happen with “Australian property prices”, the reality is that there is no such entity as the Australian property market. Secondly, what I expect to happen with prices...
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Contemplate this scenario: you buy a capital city house for $380,000 and a year later it has a market value of $530,000. Up 40% in 12 months, providing a capital gain of $150,000. Or this one: you paid just $240,000 for a house in a regional centre and a year later it’s worth $325,000 – up 35% in 12 months. And you’re getting a rental return above 7%. A third example is paying $380,000 for a house in a capital city and watching it grow to $480,000 in 12 months. Meanwhile, rents have grown 25% in your suburb, underpinned by a vacancy rate of 0.4%, and your rental return has increased from...
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Are you ready to take your superannuation to the next level? Join us for an exclusive webinar designed to help you leverage your superannuation for maximum wealth creation and tax efficiency. Super Strategies – Building Wealth and Reducing Tax for Investors In this insightful session, we’ll cover: 📖 Actionable strategies to grow your super 💰 Techniques to reduce your tax load 🏠 Methods to harmonise your super with other investments Whether you're a seasoned investor or just starting out, this webinar will provide you with the knowledge and tools to make the most of your...
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Episode Overview: In this insightful episode of the Hotspotting podcast, Tim Graham sits down with Ben Kingsley, the Chair of the Property Investors Council of Australia (PICA), to discuss the vital role that property investors play in shaping the future of Australia's real estate market. Ben provides an in-depth look at the importance of the PIPA Annual Investor Sentiment Survey and how it captures the pulse of the property investment community. Key Discussion Points: Importance of the PIPA Survey: Ben highlights why the PIPA Annual Investor Sentiment Survey is a critical tool...
info_outlineThere are many so-called research reports in Australia which do a very poor job of providing useful, accurate, credible information to consumers – but the worst of the worst is a report called Demographia which pops up once every year to misinform Australians about affordability.
This report, which is a shameless propaganda exercise by a developer lobby group, sets out to portray Australia as a place where no one – and I do mean no one – can afford to buy real estate.
The lobby group is apparently trying to convince governments across Australia that the development industry is over-regulated and that this over-regulation is causing unaffordable housing everywhere – and I do mean everywhere – in Australia.
This ridiculous report has been claiming for 20 years that the whole nation of Australian is unaffordable.
And the latest edition of the report claims that significant chunks of Australia are and I quote, “impossibly unaffordable”.
Now, think about it for a moment. If this was true, no one could afford to buy homes in Australia at all. Because, essentially, that’s what they’re claiming - that no one can afford to buy real estate.
Clearly, that’s a ridiculous and preposterous claim because all over Australia there is a high level of sales activity and prices continue to rise in most locations.
The latest official lending figures show that loans to owner-occupiers, to first-home buyers and to investors have all risen substantially in the past 12 months.
There is high demand for homes and for investment properties and the high level of sales is causing prices to rise in most locations.
Now, none of that would be possible if the Demographia report was credible and accurate – because it says the whole country is unaffordable.
Indeed, it says our major cities are the most unaffordable in the world.
But here’s the thing – the report doesn’t cover the world. It only compares Australia will a tiny proportion of the nations on the planet.
There are over 200 countries in the world – and how many are included in this report? Just seven. Australia and six others.
And yet it maintains that it can justify the claim that Australian cities are the most unaffordable in the world.
Now, if common sense prevailed, you and I wouldn’t even be aware that this report exists because it’s so implausible and lacking in any merit whatsoever.
But we DO know about it because news media in Australia doesn’t care about ethics or accuracy or fairness or credibility.
Journalists, sadly, care only about the headline and don’t care that the information on which the headline is based is patently, blatantly and obviously false.
Michael Bleby, who apparently is the Deputy Property Editor for the Australian Financial Review, was happy to report that Sydney, Melbourne and Adelaide are all “impossibly unaffordable” and ran the headline “Impossibly unaffordable housing a social risk”.
Bleby stated that Sydney is the world’s second-least affordable city for housing, based on the content of the Demographia report.
Now, I’m assuming that Bleby has seen the report, because it would unprofessional and unethical in the extreme to make such claims without looking at the evidence.
So I can only conclude that he doesn’t care too much about the substance of what he is writing, so long as it generates clickbait.
News Corp journalist Aidan Devine put his name to an article that stated that three of our capital cities were ranked in the top 10 most unaffordable housing markets in the world – and then claimed that Australia was the least affordable housing market in the English-speaking world.
So these journalists and others were happy to make these outrageous claims despite what the facts show us.
I’ve read half a dozen different articles on this and only one of them mentioned, briefly, the small number of countries in the report.
In Sydney, claimed by the report to be “impossibly unaffordable”, there were 73,290 homes sold to buyers in the past year. And the median house price rose 8.2% in the past 12 months, according to CoreLogic.
In Melbourne, also claimed to “impossibly unaffordable”, 86,200 homes changed hands in 12 months, with house prices rising 2%.
And in Adelaide, which is actually one of our most affordable capital cities - but also dubbed “impossibly unaffordable” by this shameless document - over 20,000 houses and apartments were purchased by buyers who were apparently unaware that the homes they were buying were utterly unattainable.
And Adelaide house prices rose 14.3% in the past year, according to CoreLogic.
So, if they were impossibly unaffordable before, they must be catastrophically unreachable now, after a further 14% increase in prices overall.
Clearly the report on which all that media hot air is based is laughably and demonstrably rubbish.
But you can sure that this time next year it will pop up again and come up with new sensationalist claims that aren’t supported by any scientific evidence – and our hopelessly shabby news media will be happy to publish it, because they don’t give a toss about providing you with real information and useful data.