Welcome to our June Property Update
Firstly the big new this month is the Reserve Bank raising the official interest rate by 0.5%, which is in addition to the 0.25% rise last month, bringing the official interest rate to 0.85%.
Whilst this is welcomed news for those with savings or saving for their first property, those with mortgages have seen these increases swiftly passed on.
Today the US Federal Reserve lifted rates by 0.75% which is the largest increase since 1994, so this may lead to further interest rate increases here in Australia.
The Australian Share market is down this week and bond yields are soaring, so there are some strong headwinds in the economy at the moment with increased inflation, higher energy prices in addition to the Fair Work Commission this week announcing a 5.2% minimum wage increase of $40 per week, which in turn will lead to higher prices and higher inflation.
It is expected the State government will announce major changes to Stamp Duty at this months budget, where they will overhaul upfront stamp duty in favour of an annual land tax.
In May, Sydney dwellings fell by 1%, bringing it 1.5% off the January 2022 peak. In Brisbane however values increased by 0.8% to the current record high.
Listings are down 8.7% compared to the same time last year and down 27.7% on the 5 year average.
Rental growth was up a further 1% in May, taking rents 9.3% higher over the year.
Dwelling approvals declined a further 2.4% and I expect new dwellings to further decrease as we see more building companies forced into administration.
New loan approvals for investors and first homeowners is increasing and I expect this trend to continue.
We are seeing to see some better value buying opportunities in the market at the moment, with many vendors reducing their price expectations, so if you are starting to think about your next property purchase, please get in touch and we would be happy to help.