Housing demand hits all-time high in Australia, says REA Group report
A supply shortage is driving record property demand in Australia, with demand for all dwellings nationally jumping 17% in the past 12 months to September this year, according to the new REA Group Property Demand Index results.
In September 2016 alone, demand on site has increased nationally by 3.1% for houses and 1.9% for apartments, as people viewing houses continues to outpace supply on realestate.com.au.
NSW and Victoria remain Australia’s most in-demand markets, with demand levels now at their highest ever recorded by REA Group. Tasmania and the ACT are also experiencing strong demand.
The REA Group Property Demand Index collates data from activity on its property website –
realestate.com.au – the leading source in Australia for residential property with a total average unique audience of more than 5.9 million.REA Group calculates its data on a seasonally adjusted basis the number of online visits against the average number of property listings.
The REA Group Property Demand Index also found that on realestate.com.au:
– Overall Tasmania and NSW showed the strongest demand for apartments, with the relative affordability of the Apple Isle driving demand in that market.
– Demand for all dwellings and houses peaked in April this year, with apartment demand currently sitting at an all-time high.
– All dwellings and houses demand is currently slightly below April’s levels due to a softening of the market in WA, which saw a 5.4% decrease in demand over the past 12 months.
The inaugural study has also ranked Australia’s 10 most in-demand suburbs on realestate.com.au, with Victoria dominating the housing market and NSW having seven out of 10 suburbs with the highest demand for apartments. Rankings were calculated as the highest ratio of people viewing properties in each suburb, compared to the number of properties listed.
1 Warrandyte, Vic 1 Manly, NSW
2 Richmond, Vic 2 Elizabeth Bay, NSW
3 Brunswick, Vic 3 Drummoyne, NSW
4 Northcote, Vic 4 Bellevue Hill, NSW
5 Norwood, SA 5 Parkdale, Vic
6 Ascot Vale, Vic 6 Cremorne, NSW
7 Yarraville, Vic 7 Randwick, NSW
8 Thornbury, Vic 8 Bonbeach, Vic
9 Paddington, NSW 9 Narrabeen, NSW
10 Hawthorn, Vic 10 East Melbourne, Vic
Nerida Conisbee, REA Group Chief Economist, commented: “The property demand index provides a more complete view of our insights into the property market in Australia. What we’re seeing is that demand on site is at all-time highs, driven predominantly by a lack of supply, particularly in Sydney and Melbourne.
“Despite talk of over-supply and poor demand conditions, this result supports continued price growth in what are considered to be increasingly unaffordable markets. “Conditions are very different in Western Australia where we continue to see low demand on site. The bottom of the market appears to be some way off.
“There are a number of reasons why people are not selling, and the strength of market in Sydney and Melbourne is a major factor. “Fewer people are looking to upgrade – this may because they fear they will be unable to get back into the market, or conversely, many are not willing to spend any more on property.
“Long term, tax factors play a major role in why people are holding on to property longer. For older people, moving to less expensive accommodation is not necessarily an attractive option. The family home is not income-generating and investing for income attracts tax. Therefore, holding on to the family home remains the most tax-effective option for many prospective down-sizers.”