Sydney's auctioneers have developed a taste for rocket fuel
The big question for aspirant home-owners is, how long can that last? CoreLogic's preliminary auction clearance rate for Sydney reached 82.3 per cent over the weekend, meaning more than four out of every five homes on the block over the past 48 hours hit their straps.
It's little wonder vendors are looking to auctions if the research of Deakin University's associate professor Adrian Lee is correct. He reckons auction sale prices are 6.9 per cent higher in Sydney right now compared to private treaty sales. Lesson: if you're selling right now, go to auction and clean up.
This rise in demand is carrying across to rental properties as well. We heard last week from Domain that rents in Sydney have dropped to a 15 month low; well, that's not going to last long according to REINSW. The latest REINSW Residential Vacancy Rate Report shows that rental vacancies in Sydney have dropped to 2.9 per cent, the lowest in a year.
Predictably, there's a surge of ABC pieces sharing personal stories of being priced out of the market, interspersed with articles on saving hacks and innovative solutions to cracking the market. Tasmania is a particular focus, where a shortage of rental housing is leading to significant social issues; given the shortfall in new homes being built in Sydney and Melbourne, this could be a sign of things to come for Australia's largest population growth centres.
According to Propertyology, home buyers looking for a bargain should consider apartments. It has released 10-year figures showing that in many parts of Sydney - including fast-growing high-density havens such as Wentworth Point, Rhodes, Norwest and South Strathfield, apartment prices have grown at a fraction compared to the capital gains on detached homes.
In terms of affordability, this suggests first-home buyers might get on the ground floor (pardon the pun) sooner with an apartment buy. It doesn't say much for the investment potential of high-density homes across much of Sydney, however.
Of course, a big part of the affordability question is how much you can borrow, and afford to pay back. To that end, Federal Treasurer Josh Frydenberg has directed the ACCC to investigate residential mortgage pricing practices of the big four banks in response to repeated reluctance to pass on Reserve Bank interest rate cuts.
This represents an escalation from last week's war of words around banking practices and allegations of banks gouging existing customers with higher rates with so-called Loyalty Taxes. It also follows last Friday's announcement that a new financial adviser disciplinary body, Code Monitoring Australia (CMA) will be set up by early 2021 - as recommended by the Hayne royal commission.