Housing Market and Economic Update - CoreLogic · Residential real estate underpins Australia's...

Housing Market and

Economic Update

March 2017

© 2017 CoreLogic, Inc. ■ Proprietary & Confidential

Housing overview

© 2017 CoreLogic, Inc. ■ Proprietary & Confidential2

Residential real estate underpins Australia's

wealth and has reached a portfolio value

of $6.9 trillion

3

As at the end of February 2017

Residential Real Estate

$6.9 Trillion

Australian Superannuation

$2.2 Trillion

Australian Listed Stocks

$1.7 Trillion

Commercial Real Estate

$0.922 Trillion

Source: CoreLogic, APRA, ABS, RBA, ASX

Number of dwellings

9.7 million

Outstanding

mortgage debt

$1.64 trillion

Household wealth

held in housing

51.6%

Total sales p.a.

456,840

Gross value of

sales p.a.

$267.3 billion


-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

Feb 97 Feb 99 Feb 01 Feb 03 Feb 05 Feb 07 Feb 09 Feb 11 Feb 13 Feb 15 Feb 17

Capital city dwelling values have increased at

their fastest annual pace since June 2010

4

Rolling annual change in dwelling values, combined capital cities

Median Prices Capital Gain

$600,000Houses Units Dwellings

Past 12 months 12.0% 9.2% 11.7%

$495,000Annual over five years 8.0% 6.4% 7.8%

Annual over ten years 6.0% 5.5% 6.0%

CoreLogic’s suite of hedonic indices are

available across broad housing types and

across geographical areas including

statistical divisions, statistical subdivisions

and postcodes nationally. For further

information an our hedonic method, please

visit www.corelogic.com.au/indices

Source: CoreLogic


http://www.corelogic.com.au/indices

18.4%

13.1%

2.2%

3.5%

-4.5%

5.8%

-5.3%

10.4%

11.7%

-10% 0% 10% 20%

Sydney

Melbourne

Brisbane

Adelaide

Perth

Hobart

Darwin

Canberra

Combined capitals

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%Sydney

Melbourne

Brisbane

Adelaide

Perth

Hobart

Darwin

Canberra

Past 12 months 10 year average annual

The value declines in Perth and Darwin are

resulting in a significant underperformance in

value change compared to the past decade

5

Capital gain: Average over 10 years v past 12 months Annual change in capital city dwelling values

Source: CoreLogic


0

500

1,000

1,500

Jan-97 Jan-02 Jan-07 Jan-12 Jan-170

100

200

300

400

500

600


0

200

400

600

800


1,000

2,000

3,000

4,000

5,000

6,000


0

1,000

2,000

3,000

4,000


2,000

4,000

6,000

8,000


0

2,000

4,000

6,000

8,000

10,000

12,000


0

5,000

10,000

15,000


0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000


Turnover: settled sales

have stabilised recently

across a number of

capital cities

6

Note up-to-date sales are estimates based on settled dwelling sales and will revise higher as off the plan sales move through to settlement.

Source: CoreLogic

Combined capitals

Sydney

Brisbane

Perth

Darwin

Melbourne

Adelaide

Hobart

Canberra

12 month avg


0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

Feb-09 Feb-10 Feb-11 Feb-12 Feb-13 Feb-14 Feb-15 Feb-16 Feb-17

Nu

mb

er

of

au

cti

on

s

Cle

ara

nc

e r

ate

-8.0%

-6.0%

-4.0%

-2.0%

0.0%

Jan 05 Jan 07 Jan 09 Jan 11 Jan 13 Jan 15 Jan 17

0

20

40

60

80

100

Jan 05 Jan 07 Jan 09 Jan 11 Jan 13 Jan 15 Jan 17

7

Vendor metrics: the auction market has started

the year with high clearance ratesCombined capital city auction clearance rates and volumes

Avg vendor discount, combined capitals Avg time on market, combined capitals

CoreLogic’s suite of vendor metrics are available across broad housing types and across geographical areas including statisti cal divisions, statistical subdivisions and postcodes nationally.

Note that we typically see a seasonal peak in average time on market each year in January and February.

Source: CoreLogic


StateNo of new

listings

12 mth

change (%)

No of total

listings

12 mth

change (%)

NSW 13,405 -1.9% 46,370 -21.5%

Vic 12,801 -3.9% 53,007 -7.3%

Qld 10,829 -2.8% 64,795 0.1%

SA 3,226 -6.3% 18,557 0.2%

WA 5,993 -6.0% 36,618 -1.5%

Tas 1,285 5.2% 7,539 -27.0%

NT 238 -23.5% 2,092 -2.9%

ACT 960 35.2% 2,250 -5.5%

National 48,737 -2.9% 231,228 -8.1%

Capital cityNo of new

listings

12 mth

change (%)

No of total

listings

12 mth

change (%)

Sydney 8,157 -2.7% 21,027 -11.3%

Melbourne 9,286 -2.5% 28,486 -5.1%

Brisbane 4,823 0.7% 19,755 6.6%

Adelaide 2,293 -4.9% 8,320 -0.7%

Perth 4,397 -4.2% 22,252 2.4%

Hobart 509 8.1% 1,715 -35.0%

Darwin 178 -28.5% 1,532 -4.3%

Canberra 941 34.0% 2,180 -6.2%

Combined capitals 30,584 -1.7% 105,267 -3.4%

0

50,000

100,000

150,000

200,000

250,000

300,000

Feb-09 Feb-10 Feb-11 Feb-12 Feb-13 Feb-14 Feb-15 Feb-16 Feb-17

Total listings New listings

8

New and total residential property advertisements

are lower than they were a year ago

National number of new and total listings, rolling 4 weeks to 26/02/2017

State and territory property listings Capital city property listings

Source: CoreLogic


Note that figures represent the number of residential properties captured as being advertised for sale. This count is based on ind ividual campaigns that have been matched to a CoreLogic property record, and therefore

represents a unique property count.

35.8% 43.7% 50.8% 48.8% 51.7% 55.5% 49.7% 49.3%

17.3%18.2% 16.6% 21.0% 21.9% 21.9%

14.4% 14.4%

46.8% 38.1% 32.6% 30.2% 26.4% 24.8% 35.9% 36.3%

0%

20%

40%

60%

80%

100%

NSW Vic Qld SA WA Tas NT ACT

Owner occupier new loans Owner occupier refinances Investors

$0.0

$2.0

$4.0

$6.0

$8.0

$10.0

$12.0

$14.0

$16.0

Dec-96 Dec-00 Dec-04 Dec-08 Dec-12 Dec-16

($b

)

Owner occupier new loans

Owner occupier refinances

Investment

9

Housing finance commitments to investors have

accelerated over the second half of 2016

Value of housing finance commitments – monthly, national

Owner

occupier loans

(excl. refi)

$13.9b

Investor loans

$13.2b

Housing finance commitments by type and state, December 2016

Source: CoreLogic, ABS


0.0%

10.0%

20.0%

30.0%

40.0%

Jan-92 Jan-97 Jan-02 Jan-07 Jan-12 Jan-17

Owner occupier housing Investment housing

10

Investor credit growth slowed in January but is

still accelerating on an annual basisAnnual change in total housing credit, owner occupiers vs investors

Proportion of total outstanding credit to ADIs

10% pa growth

Source: CoreLogic, RBA


0.0%

20.0%

40.0%

60.0%

80.0%


Housing Business Other personal

30,000

40,000

50,000

60,000

70,000

80,000

90,000

Aug-09 Feb-10 Aug-10 Feb-11 Aug-11 Feb-12 Aug-12 Feb-13 Aug-13 Feb-14 Aug-14 Feb-15 Aug-15 Feb-16 Aug-16 Feb-17

Number of platform events v Number of owner occ housing finance commitments

CoreLogic Mortgage Index ABS Owner Occupier Housing Finance

-60.0%

-40.0%

-20.0%

0.0%

20.0%

40.0%

60.0%

Aug-09 Feb-10 Aug-10 Feb-11 Aug-11 Feb-12 Aug-12 Feb-13 Aug-13 Feb-14 Aug-14 Feb-15 Aug-15 Feb-16 Aug-16 Feb-17

Monthly % change in platform events v Number of owner occ housing finance commitments

CoreLogic Mortgage Index ABS Owner Occupier Housing Finance

11

Mortgage demand rebounded significantly in

February 2017

CoreLogic’s Mortgage Index measures valuation activity across RP Data platforms, which more than 90% of ADI valuation requests nationally use, providing an almost real time indicator for how

much mortgage activity is taking place. For more information, contact RP Data via email: [email protected]

Source: CoreLogic


mailto:[email protected]

Capital city housing market indicators

12 © 2017 CoreLogic, Inc. ■ Proprietary & Confidential

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

Feb-01 Feb-05 Feb-09 Feb-13 Feb-17

13

CoreLogic’s suite of hedonic indices are available across broad housing types and across geographical areas including statist ical divisions, statistical subdivisions and postcodes nationally. For

further information an our hedonic method, please visit www.corelogic.com.aui/indices

Source: CoreLogic

Annual change in dwelling values Sydney dwelling

values rose by 4.5%

over the 3 months to

February 2017 to be

18.4% higher over

the past year.

Dwelling values

have increased at

their fastest annual

rate since they rose

by 18.7% in

December 2002

Sydney

Combined

capitals


http://www.corelogic.com.aui/indices

-20%

-10%

0%

10%

20%

30%

40%

50%

60%


14

Annual change in dwelling values Melbourne home

values increased by

5.5% over the three

months to February

2017 and are 13.1%

higher over the past

year. Melbourne

dwelling values are

now increasing at

their fastest annual

rate since they rose

by 14.2% in

September 2015

Melbourne

Combined

capitals



Source: CoreLogic



-20%

-10%

0%

10%

20%

30%

40%

50%

60%


15

Annual change in dwelling values Brisbane home

values have

increased by 0.4%

over the three

months to February

2017 and are 2.2%


year. Brisbane home

values have

increased by a total

of 16.1% since the

end of 2008

Brisbane

Combined

capitals



Source: CoreLogic



-20%

-10%

0%

10%

20%

30%

40%

50%

60%


16

Annual change in dwelling values Adelaide home

values fell by -0.9%

over the three

months to February

2017, taking values

3.5% higher over the

past year. Values

have increased by a

cumulative 17.3%

since the end of

2008

Adelaide

Combined

capitals



Source: CoreLogic



-20%

-10%

0%

10%

20%

30%

40%

50%

60%


17

Annual change in dwelling values Perth home values

fell by -0.9% over

the three months to

February 2017 and

they are

-4.5% lower over the

past year. Home

values across the

city have increased

by just 6.0% since

the end of 2008.

Perth

Combined

capitals



Source: CoreLogic



-20%

-10%

0%

10%

20%

30%

40%

50%

60%


18

Annual change in dwelling values Hobart home values

have increased by

5.8% over the three

months to February

2017 and are 5.8%


year. Hobart home

values have


of 11.6% since the

end of 2008

Hobart

Combined

capitals



Source: CoreLogic



-20%

-10%

0%

10%

20%

30%

40%

50%

60%


19

Annual change in dwelling values Darwin home values

have fallen by -6.0%

over the three

months to February

2017 and they are

-5.3% lower over the

past year. Values

across the city have

increased by just

14.9% since the end

of 2008

Darwin

Combined

capitals



Source: CoreLogic



-20%

-10%

0%

10%

20%

30%

40%

50%

60%


20

Annual change in dwelling values Canberra home

values have

increased by 3.3%

over the three

months to February

2017 and are 10.4%

over the past year.

Since the end of

2008, Canberra

home values have


of 37.7%.

Canberra

Combined

capitals



Source: CoreLogic



Macroeconomic and demographic indicators

21 © 2017 CoreLogic, Inc. ■ Proprietary & Confidential

1.4%

2.1%

1.4%

0.5%

1.0%

0.5%

0.2%

1.3%

1.4%

0.0% 0.5% 1.0% 1.5% 2.0% 2.5%

NSW

VIC

QLD

SA

WA

TAS

NT

ACT

AUST

20,000

25,000

30,000

35,000

40,000

45,000

50,000

Jun-86 Jun-96 Jun-06 Jun-16

0

20,000

40,000

60,000

80,000

100,000

Jun-86 Jun-96 Jun-06 Jun-16

020,00040,00060,00080,000

100,000120,000140,000

Jun-86 Jun-91 Jun-96 Jun-01 Jun-06 Jun-11 Jun-16

22

Housing demand: Victoria is leading the way in

terms of the rate of population growthQuarterly change in national population

Net overseas migration Natural increase Annual change in population



0.0%

20.0%

40.0%

60.0%

80.0%

100.0%


Houses Townhouses Low-rise units High-rise units

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

Jan-87 Jan-92 Jan-97 Jan-02 Jan-07 Jan-12 Jan-17

Houses Units

23

Housing supply: Dwelling approvals rise in

January but remain much lower than their peak

Monthly number of dwelling approvals, national

National dwelling approvals, houses v units Monthly % of total dwelling approvals



8,000

13,000

18,000

23,000

Jan-87 Jan-92 Jan-97 Jan-02 Jan-07 Jan-12 Jan-17

Total dwelling approvals Total dwelling approvals (6 month rolling avg)

0

20,000

40,000

60,000

80,000

100,000

120,000

Nov-86 Nov-91 Nov-96 Nov-01 Nov-06 Nov-11 Nov-16

Total quarterly dwelling approvals

Quarterly change in population growth

24

Housing supply: the gap between housing

demand and supply has narrowed substantially

over recent years

Quarterly dwellings approved for construction v quarterly change in population, national



-40.0%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

Feb-97 Feb-01 Feb-05 Feb-09 Feb-13 Feb-17

Consumer sentiment Capital city home values0

5,000

10,000

15,000

20,000

25,000

30,000

0

20

40

60

80

100

120

140


Consumer Sentiment (LHS)

Sales vols (Syd, Mel and Bris) (RHS)

60

80

100

120

140


Consumer Sentiment Index Six month rolling average

25

Consumer sentiment remains slightly more

pessimistic than optimistic

Consumer sentiment index

Annual change in consumer

sentiment v dwelling values

Consumer sentiment

v dwelling sales

Source: CoreLogic, Westpac-Melbourne Institute


62.0

63.0

64.0

65.0

66.0


%

3.0

4.0

5.0

6.0

7.0


%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

Jan-95 Jan-97 Jan-99 Jan-01 Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 Jan-15 Jan-17

Full-time employment Part-time employment

26

Labour force: the economy has continued to

shed full-time jobs over the past year

Annual change in employment, full time v part time

National unemployment rate National participation rate



0.0%

10.0%

20.0%

30.0%

Dec-96 Dec-00 Dec-04 Dec-08 Dec-12 Dec-16

27

Mortgage rates: while the cash rate remains on

hold, fixed rate mortgage rates have increased

Mortgage rates and cash rate over time

% of owner occupier loan commitments

on fixed rate

ASX cash rate futures implied yield curve

Source: CoreLogic, ABS, RBA


0.0%

5.0%

10.0%

15.0%

Feb-93 Feb-97 Feb-01 Feb-05 Feb-09 Feb-13 Feb-17

Standard variable mortgage rates Cash rate 3 year fixed rate

28

About Us

CoreLogic Australia is a wholly owned subsidiary of CoreLogic (NYSE: CLGX), which is the largest property data and analytics

company in the world. CoreLogic provides property information, analytics and services across Australia, New Zealand and Asia,

and recently expanded its service offering through the purchase of project activity and building cost information provider Cordell.

With Australia’s most comprehensive property databases, the company’s combined data offering is derived from public,

contributory and proprietary sources and includes over 500 million decision points spanning over three decades of collection,

providing detailed coverage of property and other encumbrances such as tenancy, location, hazard risk and related performance

information.

With over 20,000 customers and 150,000 end users, CoreLogic is the leading provider of property data, analytics and related

services to consumers, investors, real estate, mortgage, finance, banking, building services, insurance, developers, wealth

management and government. CoreLogic delivers value to clients through unique data, analytics, workflow technology, advisory

and geo spatial services. Clients rely on CoreLogic to help identify and manage growth opportunities, improve performance and

mitigate risk. CoreLogic employs over 650 people across Australia and in New Zealand. For more information call 1300 734 318 or

visit www.corelogic.com.au

CoreLogic produces an advanced suite of housing market analytics that provides key insights for understanding housing market

conditions at a granular geographic level. Granular data is often used for portfolio analysis and benchmarking, risk assessments

and understanding development feasibility and market sizing. It gives industry professionals valuable modules which provide

essential analytics and insights for decision making and strategy formation within the residential property asset class. We can tailor

reports to suit your business requirements.

Call us on 1300 734 318 or email us at [email protected] or visit us at www.corelogic.com.au


29

Granular Data and Analytics

Market Scorecard: Monitor and measure market share and performance of real estate agents at an individual office or a Franchise

brand level across Australia. Identify the competing brands and independents at a suburb, postcode, user defined territory and

State level. Easily locate growth opportunities and market hotspots, and view the performance of the established offices in these

new areas of interest.

Market Trends: Detailed housing market indicators down to the suburb level, with data in time series or snapshot and segmented

across houses, units and land. The Market Trends data includes key housing market metrics such as median prices, median

values, transaction volumes, rental statistics, vendor metrics such as average selling time and vendor discounting rates.

CoreLogic RP Data Indices: The suite of CoreLogic RP Data Indices range from simple market measurements such as

median prices through to repeat sales indices and our flagship hedonic home value indices. The CoreLogic RP Data Hedonic index

has been specifically designed to track the value of a portfolio of properties over time and is relied upon by Australian regulators

and industry as the most up to date and accurate measurement of housing market performance.

Economist Pack: A suite of indices and indicators designed specifically for Australian economic commentators who require the

most up to date and detailed view of housing market conditions. The economist pack includes the CoreLogic RP Data Hedonic

indices for capital cities and ‘rest of state’ indices, the stratified hedonic index, hedonic total return index, auction clearance rates

and median prices.

Investor Concentration Report: Understanding ownership concentrations is an important part of assessing risk. Areas with high

investor concentrations are typically allocated higher risk ratings due to the over-representation of a particular segment of the

market. Through a series of rules and logic, CoreLogic RP Data has flagged the likely ownership type of every residential property

nationally as either owner occupied, investor owned or government owned.

Mortgage Market Trend Report: CoreLogic RP Data is in a unique position to monitor mortgage related housing market

activity. Transaction volumes, dwelling values and mortgage related valuation events all comprise our Mortgage market

trend report which provides an invaluable tool for mortgage industry benchmarking and strategy.



Disclaimer

In compiling this publication, RP Data Pty Ltd trading as CoreLogic has relied upon information supplied by a number of external sources. CoreLogic does not warrant its

accuracy or completeness and to the full extent allowed by law excludes liability in contract, tort or otherwise, for any loss or damage sustained by subscribers, or by any

other person or body corporate arising from or in connection with the supply or use of the whole or any part of the information in this publication through any cause

whatsoever and limits any liability it may have to the amount paid to CoreLogic for the supply of such information.

Queensland Data

Based on or contains data provided by the State of Queensland (Department of Natural Resources and Mines) 2017. In consideration of the State permitting use of this

data you acknowledge and agree that the State gives no warranty in relation to the data (including accuracy, reliability, completeness, currency or suitability) and accepts

no liability (including without limitation, liability in negligence) for any loss, damage or costs (including consequential damage) relating to any use of the data. Data must not

be used for direct marketing or be used in breach of the privacy laws.

South Australian Data

© 2017 Copyright in this information belongs to the South Australian Government and the South Australian Government does not accept any responsibility for the accuracy

or completeness of the information or its suitability for purpose.

New South Wales Data

Contains property sales information provided under licence from the Land and Property Information (“LPI”). RP Data Pty Ltd trading as CoreLogic is authorised as a

Property Sales Information provider by the LPI.

Victorian Data

The State of Victoria owns the copyright in the Property Sales Data and reproduction of that data in any way without the consent of the State of Victoria will constitute a

breach of the Copyright Act 1968 (Cth). The State of Victoria does not warrant the accuracy or completeness of the Property Sales Data and any person using or relying

upon such information does so on the basis that the State of Victoria accepts no responsibility or liability whatsoever for any errors, faults, defects or omissions in the

information supplied.

Western Australian Data

Based on information provided by and with the permission of the Western Australian Land Information Authority (2017) trading as Landgate.

Australian Capital Territory Data

The Territory Data is the property of the Australian Capital Territory. No part of it may in any form or by any means (electronic, mechanical, microcopying, photocopying,

recording or otherwise) be reproduced, stored in a retrieval system or transmitted without prior written permission. Enquiries should be directed to: Director, Customer

Services ACT Planning and Land Authority GPO Box 1908 Canberra ACT 2601.

Tasmanian Data

This product incorporates data that is copyright owned by the Crown in Right of Tasmania. The data has been used in the product with the permission of the Crown in Right

of Tasmania. The Crown in Right of Tasmania and its employees and agents:

(a) give no warranty regarding the data's accuracy, completeness, currency or suitability for any particular purpose; and

(b) do not accept liability howsoever arising, including but not limited to negligence for any loss resulting from the use of or reliance upon the data.

Base data from the LIST © State of Tasmania http://www.thelist.tas.gov.au


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