1
00:00:00,080 --> 00:00:03,400
Speaker 1: We know that property prices continuing to decrease around the

2
00:00:03,480 --> 00:00:07,200
Speaker 1: nation as higher interest rates hit some Aussies pretty hard,

3
00:00:07,640 --> 00:00:10,520
Speaker 1: and capital city housing markets have fallen by up to

4
00:00:10,600 --> 00:00:13,560
Speaker 1: six percent in the past three months, and core Logic

5
00:00:13,640 --> 00:00:17,319
Speaker 1: Stata shows that in September properties were sold for one

6
00:00:17,360 --> 00:00:21,639
Speaker 1: point four percent less on average nationally than in August.

7
00:00:21,720 --> 00:00:23,320
Speaker 1: So joining me on the line to tell us a

8
00:00:23,360 --> 00:00:26,560
Speaker 1: little bit more about the situation is core Logic's head

9
00:00:26,560 --> 00:00:32,479
Speaker 1: of research, Eliza Owen. Good morning to you, Eliza.

10
00:00:31,040 --> 00:00:32,360
Speaker 2: Good morning, thanks for having me.

11
00:00:32,440 --> 00:00:35,239
Speaker 1: Yeah, thank you so much for your time. Now, Eliza,

12
00:00:35,479 --> 00:00:38,280
Speaker 1: how are things tracking around the nation at this point?

13
00:00:39,920 --> 00:00:44,000
Speaker 2: Well, as you say, national home values did decline another

14
00:00:44,080 --> 00:00:47,159
Speaker 2: one point four percent through the month of September, but

15
00:00:47,240 --> 00:00:50,200
Speaker 2: it almost looks like the pace of decline slowed down

16
00:00:50,240 --> 00:00:52,559
Speaker 2: a bit over the month. It's off the back of

17
00:00:52,560 --> 00:00:55,920
Speaker 2: a one point six percent drop through August, and across

18
00:00:55,920 --> 00:00:59,920
Speaker 2: the combined capital cities, we've seen auction clearance rates stable,

19
00:01:00,640 --> 00:01:03,760
Speaker 2: even increasing a little bit on the winter months, and

20
00:01:03,880 --> 00:01:07,399
Speaker 2: in terms of listings, it's been a really lackluster start

21
00:01:07,440 --> 00:01:10,960
Speaker 2: to what would usually be a spring selling season, so

22
00:01:11,160 --> 00:01:13,720
Speaker 2: vendors kind of holding up selling, which I think is

23
00:01:13,800 --> 00:01:15,759
Speaker 2: insulating price calls as well.

24
00:01:16,360 --> 00:01:18,240
Speaker 1: Yeah, right, so not as many people are sort of

25
00:01:18,240 --> 00:01:21,200
Speaker 1: putting those homes on the market, or sellers aren't putting

26
00:01:21,200 --> 00:01:22,280
Speaker 1: those homes on the market.

27
00:01:23,760 --> 00:01:27,120
Speaker 2: Yeah, that's exactly right. So usually around this time of

28
00:01:27,240 --> 00:01:31,160
Speaker 2: year we'd see about forty three thousand new listings flowing

29
00:01:31,240 --> 00:01:34,200
Speaker 2: through over the month of September. It's actually close to

30
00:01:34,200 --> 00:01:39,720
Speaker 2: to thirty four thousand through the past month. So what

31
00:01:39,760 --> 00:01:42,960
Speaker 2: that suggests to me is because selling conditions aren't very good.

32
00:01:43,520 --> 00:01:46,800
Speaker 2: It means that vendors aren't really selling if they don't

33
00:01:46,959 --> 00:01:51,160
Speaker 2: have to, and that's actually leading this situation of kind

34
00:01:51,200 --> 00:01:55,200
Speaker 2: of tight supply, which might be helping to slow the

35
00:01:55,280 --> 00:01:56,840
Speaker 2: decline a little bit nationally.

36
00:01:57,160 --> 00:02:00,880
Speaker 1: Yeah. Right now, as I understand it, the only capital

37
00:02:00,880 --> 00:02:04,080
Speaker 1: city that didn't sort of witness a monthly for was Darwin.

38
00:02:04,200 --> 00:02:06,960
Speaker 1: Why do you think that is they're.

39
00:02:06,840 --> 00:02:10,000
Speaker 2: Quiet, Achieva. I think over the past couple of months,

40
00:02:10,160 --> 00:02:14,440
Speaker 2: as we've seen pretty sharp alls in big expensive capital

41
00:02:14,480 --> 00:02:19,040
Speaker 2: cities like Sydney and Melbourne, Darwin has been very resilient

42
00:02:19,080 --> 00:02:22,600
Speaker 2: because of its relatively low price point. You've got a

43
00:02:22,680 --> 00:02:26,639
Speaker 2: median dwelling value of about five hundred and ten thousand

44
00:02:26,680 --> 00:02:30,120
Speaker 2: across Darwin at the moment, compared to medians of over

45
00:02:30,200 --> 00:02:34,800
Speaker 2: a million across Sydney, a million dollars in median houses

46
00:02:34,840 --> 00:02:38,560
Speaker 2: in Canberra and near that price point in Melbourne as well.

47
00:02:38,919 --> 00:02:42,560
Speaker 2: So the more expensive market is, the more debt you

48
00:02:42,639 --> 00:02:45,320
Speaker 2: have to take out to fund a purchase there, and

49
00:02:45,360 --> 00:02:48,440
Speaker 2: the more it's impacted by interest rates. So I think

50
00:02:48,480 --> 00:02:53,119
Speaker 2: between an affordable price point and those fewer new listings,

51
00:02:53,160 --> 00:02:53,840
Speaker 2: it's held.

52
00:02:53,639 --> 00:02:56,840
Speaker 1: Up Aliza, those you know, some of those median house

53
00:02:56,880 --> 00:03:00,240
Speaker 1: prices are incredible. It really makes you wonder, you know,

54
00:03:00,320 --> 00:03:02,560
Speaker 1: how it must it's going to be hard for that

55
00:03:02,639 --> 00:03:04,840
Speaker 1: younger generation to sort of be able to enter the

56
00:03:04,880 --> 00:03:06,440
Speaker 1: housing market at some point.

57
00:03:08,360 --> 00:03:11,440
Speaker 2: Absolutely, and I think that's reflected in so much of

58
00:03:11,520 --> 00:03:15,400
Speaker 2: the data we see around the housing market. You know,

59
00:03:15,520 --> 00:03:19,239
Speaker 2: the level of first home buyer finance going out has

60
00:03:19,320 --> 00:03:22,840
Speaker 2: dropped off rapidly since the introduction of a scheme like Homebuilder,

61
00:03:22,919 --> 00:03:25,720
Speaker 2: which which helps a lot of people into new dwellings,

62
00:03:26,520 --> 00:03:29,480
Speaker 2: and even things like the average age of a first

63
00:03:29,520 --> 00:03:33,320
Speaker 2: home buyer is now thirty five years old. Wow, that's

64
00:03:33,440 --> 00:03:37,320
Speaker 2: hardly what we associate with the young kind of millennial

65
00:03:37,680 --> 00:03:41,800
Speaker 2: or gen z of approaching the property market. Journey. So

66
00:03:42,640 --> 00:03:45,880
Speaker 2: I think the barriers to entry with those high price

67
00:03:45,960 --> 00:03:50,080
Speaker 2: points are evident. And now you've got the compounding problem

68
00:03:50,200 --> 00:03:54,040
Speaker 2: of higher mortgage rates, which is limiting borrowing capacity for

69
00:03:54,120 --> 00:03:55,440
Speaker 2: first home buyers as well.

70
00:03:55,720 --> 00:03:59,480
Speaker 1: Yeah, now speaking of those you know, of those interest rates,

71
00:03:59,520 --> 00:04:04,600
Speaker 1: we are expecting that they could actually rise again tomorrow. Firstly,

72
00:04:04,640 --> 00:04:07,400
Speaker 1: what impact are those interest rates having really on the

73
00:04:07,440 --> 00:04:10,560
Speaker 1: property market right now? And what do you think we'll

74
00:04:10,600 --> 00:04:12,360
Speaker 1: see if they do rise again tomorrow.

75
00:04:14,080 --> 00:04:16,800
Speaker 2: So the immediate impact of a rate rise on the

76
00:04:16,839 --> 00:04:20,920
Speaker 2: housing market is generally that they're inversely related. So as

77
00:04:20,960 --> 00:04:25,320
Speaker 2: interest rates rise, property prices go down. That's both because

78
00:04:25,520 --> 00:04:28,479
Speaker 2: borrowing capacity is reduced by it has become a little

79
00:04:28,480 --> 00:04:33,400
Speaker 2: bit more uncertain, and in some instances, higher mortgage rates

80
00:04:33,440 --> 00:04:36,280
Speaker 2: can trigger more selling decisions, although I don't think we're

81
00:04:36,320 --> 00:04:40,800
Speaker 2: seeing that just yet. So with tomorrow's rate rise, you know,

82
00:04:40,839 --> 00:04:43,480
Speaker 2: it's going to be hard for property prices to stabilize

83
00:04:43,560 --> 00:04:47,440
Speaker 2: or recover in that circumstance. I don't think it's until

84
00:04:47,480 --> 00:04:51,080
Speaker 2: we see a pause in rate rises, which could be

85
00:04:51,200 --> 00:04:54,359
Speaker 2: in twenty twenty three, that will really get to that

86
00:04:54,480 --> 00:04:57,159
Speaker 2: kind of bottoming out in housing market conditions.

87
00:04:57,400 --> 00:05:01,120
Speaker 1: Yeah, right now, laza. Is it just houses or is

88
00:05:01,160 --> 00:05:05,520
Speaker 1: this also impacting unit sales as well? Yeah?

89
00:05:05,560 --> 00:05:09,359
Speaker 2: Great question. So both houses in units are seeing softer

90
00:05:09,520 --> 00:05:14,120
Speaker 2: buying conditions. At a national level, across Darwin, we did

91
00:05:14,200 --> 00:05:17,960
Speaker 2: see unit values tick a little bit lower over the month,

92
00:05:18,080 --> 00:05:21,600
Speaker 2: so zero point three percent lower, where house values were

93
00:05:21,640 --> 00:05:26,520
Speaker 2: pretty flat. But broadly on a national scale, what you'd

94
00:05:26,560 --> 00:05:30,640
Speaker 2: expect to see is that more expensive dwelling markets would

95
00:05:30,680 --> 00:05:33,919
Speaker 2: be more sensitive to rate rises and that's why on

96
00:05:34,000 --> 00:05:38,039
Speaker 2: a national level we've generally seen steeper declines in the

97
00:05:38,080 --> 00:05:42,760
Speaker 2: detached house segments than we having units. And it's possible

98
00:05:42,800 --> 00:05:46,560
Speaker 2: that as rates rise, people pivot towards units more anyway,

99
00:05:46,640 --> 00:05:50,359
Speaker 2: because it's more affordable when your borrowing capacity is limited. Yeah.

100
00:05:50,920 --> 00:05:53,800
Speaker 1: Now, I know, obviously Darwin's a capital city, but some

101
00:05:53,880 --> 00:05:56,840
Speaker 1: would consider it more regional. I mean, are we seeing

102
00:05:57,000 --> 00:06:00,880
Speaker 1: other regional locations rise in price as well, or how

103
00:06:00,880 --> 00:06:05,160
Speaker 1: are things going in more regional parts of Australia.

104
00:06:05,320 --> 00:06:08,560
Speaker 2: So regional Australia had a bit of a sustained upswing.

105
00:06:08,640 --> 00:06:12,840
Speaker 2: It didn't really come into decline until about June, whereas

106
00:06:12,880 --> 00:06:17,960
Speaker 2: the capital city market started falling in value through apor. However,

107
00:06:18,080 --> 00:06:20,679
Speaker 2: now that the regional market is in a down swing.

108
00:06:21,200 --> 00:06:24,320
Speaker 2: It's kind of keeping pace with the down swing in

109
00:06:24,360 --> 00:06:27,680
Speaker 2: the capital cities. Even over the month of September, as

110
00:06:27,720 --> 00:06:30,080
Speaker 2: we saw a one point four percent decline in capital

111
00:06:30,080 --> 00:06:33,360
Speaker 2: city home values, we'vein a one point three percent decline

112
00:06:33,480 --> 00:06:37,680
Speaker 2: in regional values. So regions are certainly not immune to

113
00:06:38,400 --> 00:06:42,120
Speaker 2: rate rises. I think it's just more the further afield

114
00:06:42,560 --> 00:06:45,640
Speaker 2: or affordable markets that have been a little more resilient

115
00:06:45,680 --> 00:06:47,200
Speaker 2: in the past few months.

116
00:06:47,640 --> 00:06:49,599
Speaker 1: Well, it's really interesting. I think it's going to be

117
00:06:50,080 --> 00:06:52,000
Speaker 1: you know, it is going to continue to be interesting

118
00:06:52,040 --> 00:06:53,720
Speaker 1: to see where it all sort of lands. As you

119
00:06:53,839 --> 00:06:56,320
Speaker 1: touched on, you know, with those interest rates, it has

120
00:06:56,360 --> 00:06:59,120
Speaker 1: an impact on different types of properties. I know for

121
00:06:59,240 --> 00:07:01,359
Speaker 1: us here in Dall and you know, people wondering, I

122
00:07:01,400 --> 00:07:04,520
Speaker 1: guess what is going to happen, and only time will

123
00:07:04,560 --> 00:07:05,400
Speaker 1: tell I suppose.

124
00:07:07,040 --> 00:07:09,520
Speaker 2: Yeah, that's right. And remember when it comes to your

125
00:07:09,560 --> 00:07:13,840
Speaker 2: property decisions, it's got to be based on your individual circumstances.

126
00:07:14,440 --> 00:07:17,680
Speaker 2: Don't worry about trying to time a property purchase to

127
00:07:18,160 --> 00:07:22,880
Speaker 2: the cycle, because that's impossible, right, Yeah. I think just

128
00:07:23,120 --> 00:07:26,400
Speaker 2: looking out for properties that you can afford, that you

129
00:07:26,440 --> 00:07:29,960
Speaker 2: can afford in the case of further rate risers. That's

130
00:07:30,000 --> 00:07:32,840
Speaker 2: the kind of question you need to be asking yourself

131
00:07:32,920 --> 00:07:33,400
Speaker 2: right now.

132
00:07:33,720 --> 00:07:36,520
Speaker 1: Yes, that is a very good point to make, I think,

133
00:07:36,920 --> 00:07:40,880
Speaker 1: Eliza Owen, core Logic's head of research, we really appreciate

134
00:07:40,920 --> 00:07:42,800
Speaker 1: your time this morning. Thanks so much for chatting with

135
00:07:42,880 --> 00:07:44,760
Speaker 1: us anytime.

136
00:07:44,840 --> 00:07:45,280
Speaker 2: Take care.

137
00:07:45,440 --> 00:07:46,120
Speaker 1: Thank you,