Property Investors have been left in shock, as the housing market rebounds quickly leaving many investors unprepared.
Strong property market and economic performance during November has only further added to buyer confidence. The most popular key regional cities experiencing unprecedented volumes of enquiries from both buyers and renters looking to relocate, as the record numbers of people exit our biggest cities.
We have also seen the housing construction sector rally to record levels.
“October 2020 was the best month for new detached house building approvals in almost 21 years. The numbers out today provide further proof that the HomeBuilder scheme is a huge success in supporting new home building at a very challenging time.”
Master Builders Australia chief economist Shane Garrett
Approvals Skyrocket To 20 Year High
Building Approvals for private sector houses rose for the fourth consecutive month in October and were at the highest recorded level since February 2000, according to ABS data.
Residential building approvals rose 3.8% in October, defying economists’ forecasts of a contraction following a huge September spike driven by the government’s HomeBuilder grant.
Daniel Rossi, director of construction statistics at the ABS, pointed attention towards the continued strong demand for detached housing benefiting from the relaxation of pandemic restrictions in most states and territories. “Federal and state-based incentives are also providing support for the housing sector,” Rossi says.
Housing Industry’s Association’s Craig Jennion says the figures show the start of the impact of stage one of HomeBuilder. In October there were 10,692 private sector houses approved, up 3.1% from September and 32% higher than 12 months ago.
HomeBuilder Extension Boosts Economy
The Federal Government has extended and adjusted the HomeBuilder scheme to keep hundreds of thousands of people in jobs as Australia continues to recover from the pandemic.
The updated program will include extending the eligibility for HomeBuilder from 1 January to 31 March; tapering the grant to $15,000 for owner-occupiers who sign contracts between 1 January and 31 March; extending the commencement window by 6 months (to the end of September 2021); and increasing the price cap in Victoria and New South Wales to $850 000 and $950,000.
This has been welcomed by the Property Council of Australia, a strong advocate for an extension. It says HomeBuilder saved the construction industry from decline earlier this year.
Prices Rise in all Markets in Nov
Every capital city and every regional market recorded house price growth in November, according to the latest data from CoreLogic.
Nationally house prices rose 1.1% in November, led by a 1.4% in regional markets which continue to out-perform the capital cities.
Apartment markets remained soft recording a small rise of 0.2%, again headed by a 1.4% increase in the regions.
Of the 15 major market jurisdictions in Australia (eight capital cities and seven regional markets), 13 have recorded house price growth in the past 12 months, the only exceptions being Melbourne and Regional WA.
All markets except Brisbane have also recorded annual growth in the median apartment prices. In November, house price growth was led by a 2.2% rise in Canberra, with Regional Tasmania up 1.8%, Hobart up 1.7% and Darwin rising 1.6%.
The annual growth in house prices has been headed by Regional Tasmania (up 10.6%), Darwin (up 9.1%), Canberra (up 7.8%) and Regional NSW (up 7.4%). The growth in house prices has been greater in the regions in the past month, past quarter, the year to date and past 12 months.