October 2004 - A Market Snapshot: The good news continues October 2004 RETURN
The Australian economy is still showing its resilience with a growth of 4.1% for the 2004 financial year and 0.6% for the June quarter. First home buyers are on the march & at their most active for 2 years. They comprised 17.2% of Victorian home loan borrowers in the month of July. This is a dramatic recovery from the December 03 levels of 14.2 %. Our recommendation for property in established areas continues. After recent falls in May/June totalling 4.9%, Victorians borrowing to occupy property have surged to a solid recovery in July. The latest figures show a seasonally adjusted increase of 5.4% in owner occupiers loans yet interestingly show a 2.4% fall in lending for new homes. This is a clear indication people are preferring proven, established real estate & certainly endorses inner city property. Melbourne’s property market is also on the rebound, with a 1% rise in established house prices for the June quarter. Nationally prices dropped 1.2% for the same period. The average price of properties in all capital cities rose by 10.9% in the year to June 2004. On the 8th of September the Reserve Bank of Australia elected to preserve official interest rates at their current level of 5.25% for the 9th consecutive month. Property available this spring is currently running at only 30-40% of normal levels. This lack of supply will ensure buoyant values across the board in built up or established areas. Inner city vacancies have recovered from the December 2003 spike to traditional levels of 3.9%. This is due to little supply of new CBD properties this year. As previously advised new releases have only a short term effect on the market whilst demand is still considered consistently strong.
The Australian economy is still showing its resilience with a growth of 4.1% for the 2004 financial year and 0.6% for the June quarter. First home buyers are on the march & at their most active for 2 years. They comprised 17.2% of Victorian home loan borrowers in the month of July. This is a dramatic recovery from the December 03 levels of 14.2 %. Our recommendation for property in established areas continues. After recent falls in May/June totalling 4.9%, Victorians borrowing to occupy property have surged to a solid recovery in July. The latest figures show a seasonally adjusted increase of 5.4% in owner occupiers loans yet interestingly show a 2.4% fall in lending for new homes. This is a clear indication people are preferring proven, established real estate & certainly endorses inner city property. Melbourne’s property market is also on the rebound, with a 1% rise in established house prices for the June quarter. Nationally prices dropped 1.2% for the same period. The average price of properties in all capital cities rose by 10.9% in the year to June 2004. On the 8th of September the Reserve Bank of Australia elected to preserve official interest rates at their current level of 5.25% for the 9th consecutive month. Property available this spring is currently running at only 30-40% of normal levels. This lack of supply will ensure buoyant values across the board in built up or established areas. Inner city vacancies have recovered from the December 2003 spike to traditional levels of 3.9%. This is due to little supply of new CBD properties this year. As previously advised new releases have only a short term effect on the market whilst demand is still considered consistently strong.