Australia's Property Market Pressure Index
Source: Propertyology
With property prices rising all over Australia the degree of pressure within property markets has reached all-time record levels.
Australia's rising-tides-lifts-all-ships property market is currently underpinned by two common denominators: on the deman side is record low interest rates while the volume of dwellings listed for sale is as tight as a mouse in a matchbox.
Contrary to some recent commentary, overall Australia does have enough dwellings to house our 25.7 million residents. The extra 1.8 million dwellings added to the nation's housing stock over the last decade was more than enough for the 3.6 million increase in population.
Also, let's not forget we have recently cranked up our construction sector at a time when Australia's population growth rate is the lowest since World War 1, more than 100 years ago.
Property prices are increasing at the fastest pace in a generation (since 2004, to be specific) primarily because the total volume of dwellings advertised for sale has consistently declined from 345,058 just 5-years ago to currently only 236,218.
So, it is not a construction problem - the primary issue is that property buyers are competing for a pitiful 2.2 percent of nationwide dwelling stock.
We are currently in the early stages of a national property boom that, to be completely frank, Australia desperately needs to have
While no Australian location is spared from these ridiculously low resale supply volumes, the reading on the real estate pressure gauge will always vary from location to location.
Propertyology has compared the volume of properties listed for sale in each Australian location now with this time 5 years ago.
A very high portion of Australia's 200 individual towns and cities have seen the volume of properties listed for sale over the last 5 years decline by more than 20 percent.
Arguably Australia's hottest property at the moment is New South Wales' north coast. House prices in locations such as Ballina, Byron and Coffs Harbour increased by 30 percent over the 12 months directly after the March 2020 national lockdown, while advertised rents also produced an annual increase of more than $7,000.
Sydney's south-west and the Northern Beaches have tigthened the most from a resale supply perspective. It is a completely different story though for Sydney's rental sypply surplus and weak economic outlook.
Queensland, Australia's most decentralised state, has widespread property market pressure. Resale housing supply has reduced significantly over the last 5 years in Bundaberg (36 percent), Cairns (33 percent), Gold Coast (27 percent), Maryborough (44 percent) and Townsville (30 percent).
On the Sunshine Coast, the property market is as tight as rusty bolt in locations such as Noosa, Maroochydore, Nambour, Caloundra, Coolum and Gympie.
While they were underwhelming property markets for much of the last decade, resale supply in Brisbane (29 percent less) and Adelaide (31 percent) has reduced significantly over the last 2 years.
Australia's second best performing capial city property market over the last vie years, Canberra, continues to tighten. Along with Darwin, Hobart, and Sydney, Canberra produced a 20 percent increase in median house price over the 12 months ending June 2021.
So much for all that doomsday talk of economic depressions, fiscal cliffs and market crashes.
A notable observation from Propertyology's research is that there is still ample resale supply in each of the capital city CBD's. The only exception to this is Hobart, which does not allow high density apartment development.
