Value

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Is new supply of apartment catching up with demand?
Decline in unit values was the most marked price trend in May, according to CoreLogic RP Data.
There was a 2.8% decline in May for Sydney apartments to a $648,000 median and a 2.5% decline for Melbourne apartments to a $480,000 median.
Melbourne house values are now 9.8% higher over the year compared with a 2.9% rise in unit values.
Every other capital city is seeing a similar, though not as marked, trend with the capital gain for houses recorded at a higher rate compared with the unit market.
“The higher supply levels are likely to be a primary reason why unit values are rising at a much slower pace than house values in Sydney and Melbourne," according to CoreLogic RP Data head of research, Tim Lawless.
"The pace of growth in unit values across Sydney is about half that being recorded across the detached housing sector, with house values up 16.4% (to $880,000) over the year compared with an 8.8% rise in unit values.” Melbourne house median sits at $620,200.
Overall dwelling price growth stalled in May with national dwelling values down 0.9% over the month, Tim Lawless said.
But the weaker reading across the May results is likely to be short-lived, he says, noting the May indices results marked the three year anniversary for the current growth cycle which commenced at the end of May 2012.
Since that time, Mr Lawless noted that capital city dwelling values have increased by 24.2% with Sydney values rising a significant 39.3 per cent since values bottomed out in May 2012.
Melbourne dwelling values have seen the second highest rate of growth over the current cycle, increasing by 22.4% while in Darwin, values are 18.3% higher.
Perth values are up 13.2% followed by Brisbane at 10.6%, Adelaide at 9.9%, Canberra with a growth rate of 8.3% over the cycle, and Hobart where values are 7.7% higher over the cycle to date.
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Highlights over the three months to May 2015
<ul>
<li>Best performing capital city: Sydney +3.3% </li>
<li>Weakest performing capital city: Hobart -0.9% </li>
<li>Highest rental yields: Darwin houses with gross rental yield of 5.6% and Darwin Units at 5.8%</li>
<li>Lowest rental yields: Melbourne houses with gross rental yield of 3.2% and Melbourne units at 4.3%</li>
<li>Most expensive city: Sydney with a median dwelling price of $752,000</li>
<li>Most affordable city: Hobart with a median dwelling price of $328,000</li>
</ul>
 
Capital city rental yields remained steady over the month with the typical capital city rental dwelling attracting a gross yield of 3.7%, however yields have compressed substantially over the growth cycle to date.
“Over the past three years, dwelling values have risen more than three times as fast as rents," Tim Lawless said.
"Dwelling values are 24.2%higher across the combined capitals over the past three years while weekly rents have risen by only 7.2%.
"The net result is that gross rental yields have been compressed from 4.3% back in 2012 to the current average gross yield of 3.7% across the combined capital city index,” he said.
Rental yields are currently the lowest in Melbourne - a typical house is returning a gross yield of 3.2% while units are providing a higher gross yield, averaging 4.3%. Sydney follows closely behind, recording a gross yield of 3.4% for houses and 4.5% for units.
“If the current trend continues, it won’t be long before Sydney overtakes Melbourne as the lowest yielding city," Tim Lawless said.
"Sydney yields have slipped by 41 basis points over the past twelve months compared with Melbourne where the gross rental yield is 22 basis points lower.”
“Clearly, investors are not bothered by the low rental yields that are currently available with housing finance data showing investors comprise a record 51 of the value of new home loan originations, “ Mr Lawless said.
 
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jchancellor-FAypfDUnLy

Apartment price decline May's most marked trend: CoreLogic RP Data

Townhouses provide an affordable alternative to freestanding homes in capital cities, ideal for families, investors and young professionals.&nbsp;

Despite Brisbane&#39;s ban on new townhouse developments in low-density residential suburbs, approved&nbsp;in 2019, demand for these property&#39;s still exist. This provides&nbsp;great investment potential&nbsp;for those interested in securing an affordable townhouse in Brisbane&#39;s outer suburbs.&nbsp;

Urban takes a look at six of Brisbane&#39;s best value townhouses on the market right now.&nbsp;

1. <a href="https://www.urban.com.au/buildings/gardenia-249-gardenia-place-bridgeman-downs?last_source_news_article_id=89594&amp;ref=news_related_project">Gardenia</a>, Bridgeman Downs 
Address: 249 Gardenia Place, Bridgeman Downs QLD 4035 
Three-bedroom townhomes from $489,999

<a href="https://www.urban.com.au/buildings/gardenia-249-gardenia-place-bridgeman-downs"><img alt="" class="image-article-full-width-580px" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/gardenia1.jpg?itok=Ch2rBapZ" style="width: 580px; height: 435px;" /></a>

Comprising 38 contemporary townhomes, Gardenia estate combines quality finishes and neutral tones to create a modern atmosphere. Developed in the leafy green surrounds of Bridgeman Downs, the stylish turn-key homes offer great value for investors and owner-occupiers alike.

Bridgeman Downs is one of Brisbane North&rsquo;s most sought-after suburbs, known for its open, green spaces and close proximity to the Brisbane CBD, Chermside shopping centre and Prince Charles Hospital.

[smartcode_project:default project_id=29167]

2. <a href="https://www.urban.com.au/buildings/sunset-on-bramble-15-bramble-street-woody-point?last_source_news_article_id=89594&amp;ref=news_related_project">Sunset on Bramble</a>, Woody Point 
Address: 15 Bramble Street, Woody Point QLD 4019 
Three-bedroom townhomes from $525,000

Sunset on Bramble offers contemporary beachside living in an established neighbourhood. Situated in Woody Point, potential buyers will be wowed by the relaxed seaside living and charming eateries that dot the coastal suburb.

The development boasts open-plan living, light-filled spaces and floor-to-ceiling windows. Ensuring convenience, these townhomes are located only 30 minutes to the Brisbane CBD, 25 minutes to the Brisbane Airport and under an hour to the Sunshine Coast.

[smartcode_project:default project_id=29177]

3. <a href="https://www.urban.com.au/new-townhouses/parkvista-kingsdale-avenue-thornlands?last_source_news_article_id=89594&amp;ref=news_related_project">Parkvista</a>, Thornlands 
Address: Kingsdale Avenue, Thornlands QLD 4164 
Three-bedroom townhomes from $417,000

<a href="https://www.urban.com.au/new-townhouses/parkvista-kingsdale-avenue-thornlands"><img alt="" height="1440" src="https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/parkvista.jpg" width="3200" /></a>

Thornlands&rsquo; latest two-staged project, Parkvista, could potentially be ideal for families hoping to find an inviting and friendly community. The stylish, turn-key townhomes offer community living, complete with pool, green spaces and sheltered seating areas.

Over 2.2 hectares of parklands are adjacent to the community, with integrated playgrounds and brand-new community childcare centre only a few minutes&rsquo; walk away. The residences boast tasteful interior design, energy efficient appliances and low-maintenance landscaping.

[smartcode_project:default project_id=28075]

4. <a href="https://www.urban.com.au/buildings/clearwater-junction-clearwater-street-bethania?last_source_news_article_id=89594&amp;ref=news_related_project">Clearwater Junction</a>, Bethania 
Address: Clearwater street, Bethania QLD 4205 
Three-bedroom townhomes from $335,000

<a href="https://www.urban.com.au/buildings/clearwater-junction-clearwater-street-bethania"><img alt="" height="900" src="https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/bethania.jpg" width="1200" /></a>

South of Brisbane&rsquo;s CBD within the Logan City region sits the affordable Clearwater Junction development. The boutique estate, a collection of 61 three-bedroom townhouses, has been developed with timeless design in mind.

Offering a comfortable new home located nearby Logan entertainment precinct, the project offers open-plan living, modern kitchen and spacious bedrooms for young professions, families or investors.

[smartcode_project:default project_id=29171]

5. <a href="https://www.urban.com.au/buildings/metro-on-brushwood-9-11-wattlebird-street-mango-hill?last_source_news_article_id=89594&amp;ref=news_related_project">Metro on Brushwood</a>, Mango Hill 
Address: 9-11 Wattlebird Street, Mango Hill QLD 4509 
Three-bedroom townhomes from $360,000

<a href="https://www.urban.com.au/buildings/metro-on-brushwood-9-11-wattlebird-street-mango-hill"><img alt="" height="1440" src="https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/parkvista.jpg" width="3200" /></a>

Offering a total of 79 townhomes with a mix of three and four-bedroom configurations, Metro on Brushwood presents high standard living at great value. The development provides an amazing opportunity for young families or those looking to add to their investment portfolio.

Metro on Brushwood features an onsite manager, entertainment area and a gym, as well as a fully-fenced private courtyard and modern kitchen.

[smartcode_project:default project_id=29176]

6. <a href="https://www.urban.com.au/new-townhouses/fulcher-lane-102-fulcher-road-red-hill?last_source_news_article_id=89594&amp;ref=news_related_project">Fulcher Lane</a>, Red Hill 
Address: 102 Fulcher Road, Red Hill QLD 4059 
Three-bedroom townhomes from $869,000

<a href="https://www.urban.com.au/new-townhouses/fulcher-lane-102-fulcher-road-red-hill"><img alt="" height="533" src="https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/fulcher_.jpg" width="800" /></a>

Situated in Brisbane&rsquo;s inner-north, Fulcher Lane features 20 three-bedroom, three-bathroom townhouses. The homes&rsquo; architecture includes a &lsquo;Queenslander&rsquo; style exterior, to ensure they blend in well with the surrounding established homes.

The luxury residences are expected to reach completion later this year, offering open-plan living, multi-purpose room, and the choice to tailor the home to a family&rsquo;s individual needs. This includes adding a private lift, pool, or altering floor-plan configurations in some areas of the home.

[smartcode_project:default project_id=29185]

Urban takes a look at six of Brisbane's best value townhouses on the market right now

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6 of Brisbane’s best value townhomes on the market

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Both Sydney and Melbourne have had comfortable dwelling value increases over the financial year, with Sydney increasing by 16.2% and Melbourne 10.2%.
But Canberra's growth put it in third place, replacing Darwin.
According to the CoreLogic June RP Data Hedonic Home Value Index, every other capital city grew less than 5%, with dwelling values are down over the year in Darwin (-2.9%) and Perth (-0.9 %). 
The median price for a home in Sydney is $900,000, with the Melbourne median at $615,000, based on sales during the past quarter.
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Capital Growth to June 30
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mick.cee-iDmgDDAmu8

Canberra overtakes Darwin to be third most expensive capial city: CoreLogic RP Data

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The valuation firm, Herron Todd White has issued its latest property clock - a simple broad brush means to suggest where property markets are - and what direction prices are moving in.
The valuation firm has included capital and regional cities on the property clock for house price direction.
 To view the property clock in full, <a href="/images/2015/07/13/new_clock.jpg" target="_blank">click here</a>.
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Dubbo, Newcastle and Gippsland at peak pricing in July HTW property clock

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Combined capital city home values went up 9.8% in the 2014-15 financial year, with Sydney having the strongest capital growth followed by Melbourne.
The latest CoreLogic RP Data Home Value Index found combined capital city home values increased by 43.1% between December 2008 and June 2015.
CoreLogic RP Data researcher Cameron Kusher said since the end of 2008, value growth in Sydney and Melbourne has stood head and shoulders above all other cities.
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“Over the past three years we’ve seen further growth in home values on the back of a renewed interest rate cutting cycle," Mr Kusher said.
"Since the financial crisis we’ve seen residential unit construction surge to record high levels… despite more units being built, most buyers still show a preference for a detached house.
"As a result of this trend, Sydney and Melbourne are the strongest housing markets for capital growth and we expect this to continue over the coming financial year.” 
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Capital city home values up 9.8% in FY15: CoreLogic RP Data

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JPMorgan has suggested the McGrath estate agency had a $253 million to $324 million enterprise value, according to research sent to fund managers, and seen by the Australian Financial Review.
The investment bank's multiples-based valuation applied an 8 times to 10 times range to pro-forma FY16 EBITDA of $31 million.
The report comes after Bell Potter put a $266 million to $315 million enterprise value on the business, as revealed by the authorative AFR Street Talk column on Monday. 
JPMorgan's told clients McGrath was one of the leading real estate services brands in Australia with 7.2% market share in New South Wales, 5.4% in the Australian Capital Territory and an emerging 1.3% presence in Queensland. 
It argued McGrath had a premium brand, business model and culture to attract and retain talent. 
JPMorgan forecast McGrath to record $141 million revenue in the 2016 financial year, on a proforma basis, and $18.2 million net profit. 
The broker compared McGrath to companies including the UK's largest real estate services group Countrywide, Foxtons Group and United States based Realogy and RE/MAX. 
McGrath Limited has recently applied for the McGrath Operations Limited name with ASIC as well as share paperwork lodged with authorities earlier this month.
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McGrath's real estate group is seeking to come to stockmarket with 67 company and franchise offices, having grown from 22 in the 2009 financial year. 
McGrath agreed to buy 10 Sydney offices controlled by <a href="/news/46735-mcgrath-ltd-acquire-shane-smollen-s-10-sydney-franchise-offices" target="_blank">Shane Smollen earlier this month</a>.
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The AFR suggested that fund managers will be seeking to test the reliability of McGrath's forecasts given the cooling in the Sydney property market, but noted the company has been able to consistently grow profits through various property cycles.
McGrath had a property sales volume of 16 per cent a year, compounded, in the five years to 2015, which included periods of downturn in the Sydney market.
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McGrath given $253 million to $324 value by JP Morgan

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EXPERT OBSERVER
Nationally, from the market peak to the end of May ’19, the most affordable quarter has seen values fall by -1.4%, the middle of the market has seen values fall -6.6% and the top quarter has fallen by -11.6%.
The -1.4% fall across the lower quartile is the largest since Sep-18, the -6.6% fall across the middle of the market is slightly down on the previous month while the -11.6% fall across the top quartile is the second consecutive month in which falls have slowed and the smallest annual decline since Dec-18.
Combined capital cities
Low quartile values are -5.1% lower over the year, middle market values have fallen -8.3% and top quartile is -12.4% lower. The -5.1% fall is the largest since September 2008 and the -12.4% fall is the smallest since December 2018.
Combined regional markets
Values across the most affordable quarter of properties are -1.2% lower compared to a -1.6% fall across the middle of the market and a 6.7% fall across the top quartile (the largest fall since January 2012).
<img src="https://www.urban.com.au/images/2019/6/13/Declining%20Values%201.JPG" alt="">
Sydney
The low quartile has recorded a value fall of -2.0% (smallest fall since Oct-18) compared to -11.9% across the middle of the market (smallest fall since Jan-19) and -12.5% across the top quartile (smallest fall since Nov-18).
Regional NSW Values across the most affordable quarter of properties are 0.6% lower (slowest growth since Nov-18), the middle of the market has recorded falls of -4.6% and the top quartile has recorded falls of -9.0%.
<img src="https://www.urban.com.au/images/2019/6/13/Declining%20Values%202.JPG" alt="">
Melbourne
The -13.8% fall across the most expensive quarter of dwellings is the smallest since Nov-18 while the middle of the market has seen values fall -10.1% (smallest fall since Jan-19) and the most affordable quarter has recorded a value fall of -0.9% (smallest fall since Dec-18).
Regional Vic
The most affordable quarter of properties have increased in value by 0.8% while the middle of the market has increased by 1.2% (slowest rate of growth since Sep-16) and the top quartile has fallen by -6.4% (the largest fall since Feb12).
<img src="https://www.urban.com.au/images/2019/6/13/Declining%20Values%203.JPG" alt="">
Brisbane
Values have fallen by -0.7% across the most affordable quarter of dwellings compared to a -3.3% fall across the middle of the market (largest fall since Feb-12) and a -6.2% fall across the most expensive quarter of properties (largest fall since Jan-12).
Regional Qld
The most expensive quarter of dwellings fell - 3.5% compared to a 0.7% fall across the middle of the market and a -0.3% fall across the most affordable quarter of the market.
<img src="https://www.urban.com.au/images/2019/6/13/Declining%20Values%204.JPG" alt="">
Adelaide
The most affordable quarter of dwellings have recorded growth of 0.9% (strongest growth since May-18) while the middle of the market has recorded a 0.3% increase and the top quarter of properties have recorded a fall of -2.7%, their largest fall since Jan-13.
Regional SA
The most affordable quarter of properties have increased by 0.3% over the past year (the strongest growth since Aug-18) compared to a 3.7% increase across the middle of the market and a 0.6% increase across the most affordable quarter of properties.
<img src="https://www.urban.com.au/images/2019/6/13/Declining%20Values%205.JPG" alt="">
Perth
Values across the most affordable quarter of properties are -2.4% lower over the year compared to an -8.9% fall across the middle of the market and an -11.6% fall across the most expensive quarter of properties.
Regional WA
The most affordable quarter of the market recorded a decline in values of -1.8% compared to -7.5% across the middle of the market and a -13.1% fall across the most expensive quarter, the largest fall since Jan-15.
<img src="https://www.urban.com.au/images/2019/6/13/Declining%20Values%206.JPG" alt="">
Hobart
The most affordable quarter of properties recorded a value increase of 4.6% over the year (the slowest rate of growth since Jun-16) compared to a 0.6% increase across the middle of the market (slowest growth since Jun-16) and a -0.5% fall across the most expensive properties (largest fall since Feb-15).
Regional Tas
The most affordable quarter of properties recorded an 8.8% annual increase (strongest growth since Nov-18) while the middle of the market recorded growth of 3.8% and the most expensive quarter recorded 3.0% growth over the year.
<img src="https://www.urban.com.au/images/2019/6/13/Declining%20Values%207.JPG" alt="">
Darwin
The most expensive quarter of properties across the city have fallen in value by -16.8% over the past year (largest fall since May-16) compared to a -17.0% fall across the middle of the market (largest fall on record) and a -14.6% fall across the most affordable quarter of the market (largest fall since Nov-18).
Regional NT The most affordable quarter of properties have recorded an increase of 11.3% over the past year, their largest increase since Apr-17 while the middle of the market has seen values rise 1.9% and the most expensive quarter of properties have fallen by -0.2%.
<img src="https://www.urban.com.au/images/2019/6/13/Declining%20Values%208.JPG" alt="">
Canberra
The most expensive quarter of properties have recorded no change in value over the past year while the middle of the market has recorded growth of 0.7% (slowest growth since Aug-16) and the most affordable quarter has recorded value growth of 1.3% (slowest growth since Jun-16).
<img src="https://www.urban.com.au/images/2019/6/13/Declining%20Values%209.JPG" alt="">
Over the past year, most capital cities and regional markets have been recording value declines. While values are broadly continuing to fall, the rate of these falls on a monthly basis has been slowing.
After having seen much larger corrections than the other two segments (following a larger growth phase), the most expensive segment of the market is seeing its rate of decline slow.
This is a trend that has played out before whereby premium housing values fall the fastest initially but also sees the falls cease earlier than other market segments.
It is still early days but with the housing market expected to trough in late 2019, the premium housing sector may find a floor first and start to show some level of recovery before the other segments.
CAMERON KUSHER  is the head of research for the Australian branch of CoreLogic
Kusher regularly posts on the <a href="https://www.corelogic.com.au/taxonomy/corelogic-people/cameron-kusher" target="_blank">CoreLogic website</a>.
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