Reisdential Market

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The market in Queensland's Toowoomba looks set to continue to soften into the second half of 2016, but the sub-$500,000 price bracket remains the most active as it attracts investors, owner-occupiers and renovators alike, say valuation firm Herron Todd White in its residential property report for July 2016. The report focuses on property investing in the $500,000 range.
Toowoomba’s median house price sits marginally below that of the previous year at $363,000 with reduced sale volumes also recorded. Of all dwelling sales recorded in 2016 to date, approximately 41 percent were between $300,000 and $400,000, while sales over $500,000 only constituted approximately 18 percent. Therefore despite reduced volumes, the sub $500,000 price bracket which comfortably encompasses the median price remains significantly more active than higher price points.
At the $500,000 price point there is a broad range of properties available. The sales below are examples of contrasting property types that have recently sold.
The property below sold for $499,000 in February (CoreLogic) and is a three-bedroom, one-bathroom, renovated colonial dwelling in East Toowoomba. 
<img src="/images/2016/07/11/Toowoomba-first.png" alt="">
In contrast, a Middle Ridge, modern, brick, three-bedroom, two-bathroom property sold for $505,000 in February, according to CoreLogic.
As for rental demand, Toowoomba’s vacancy rate is at 3.7 percent, which is almost double that of previous years and accordingly, there has been a parallel weakening of rental values. Despite this, sub $400 per week rentals have continued to see a relatively stable level of enquiry.
"Overall, despite the softening market conditions there is likely to be continued demand across the board for properties for sale below $500,000 and it is predicted that the owner-occupier dominated suburbs such as East Toowoomba, Middle Ridge, Kearneys Spring, South Toowoomba, Mount Lofty, Darling Heights and Rangeville will continue to record a more stable growth pattern than new investor driven developments across Toowoomba’s western suburbs," the HTW report concludes.
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Queensland's Toowoomba property market set to soften, but sub-$500,000 still scores: HTW

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Rents across the combined capital cities have had the weakest annual change on record with rental yields hitting record low levels, according to CoreLogic RP Data's April Rental Index.
April gross rental yields for houses are 3.3 percent and 4.2 percent for units and a year ago were 2.6 percent and 4.5 percent respectively.
According to the report the expectation is falls will continue with means that capital growth becoming a more important factor for property investors than rental returns.
<a href="/images/2016/05/12/Screen%20Shot%202016-05-12%20at%2012.35.29%20PM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/05/12/Screen%20Shot%202016-05-12%20at%2012.35.29%20PM.png" alt="" width="855" height="695">
"Rental yields are lowest for houses in Melbourne (2.9%) and highest in Hobart (5.3%). Unit yields are lowest in Sydney and Melbourne at 4.0% and highest in Brisbane and Hobart at 5.3%. House and unit yields are at record lows in both Sydney and Melbourne," the report said.
"The low yield profile across Australia’s two largest cities, which are also the cities that attract the largest investment demand, suggests that most recent investors, despite the low mortgage rate settings, are likely to be utilising a negative gearing strategy to offset their cash flow losses against their taxable income. 
"Across every capital city except Hobart, where they are 10 basis points higher, house rental yields are lower now than they were at the same time last year. This is reflective of the fact that rental rates for houses are falling while values have continued to rise. 
"The unit market shows similar trends to the detached housing market. Yields are unchanged over the year in Hobart and Canberra and lower over all other capital cities. The generally softer yields point to market conditions in which unit value growth has generally outpaced unit rental growth."
<a href="/images/2016/05/12/Screen%20Shot%202016-05-12%20at%2012.44.37%20PM.png" target="_blank">Click to enlarge </a>
<img src="/images/2016/05/12/Screen%20Shot%202016-05-12%20at%2012.44.37%20PM.png" alt="">
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