Welcome to Today In Property, where we celebrate good news when we find it.
The HIA New Home Sales report released earlier this week showed a national 0.8 per cent increase in new home sales in the June quarter - which is exceptional news for new home builders.
What wasn't so flash were new ABS housing approval figures released yesterday showing volumes hit a six-year low in the year to June. This is evidence of the long tail of a new home sale; while sales number may have ticked up last quarter, it'll take a while yet for those volumes to be reflected in the approvals tally. The report punched out by BIS Oxford Economics over the weekend tells that story for us; their boffins are tipping a further 8 per cent decline in building starts in the 2019/20 financial year.
Construction sector pundits are tipping another 100,000 construction jobs are on the line as a result of the ABS housing approval numbers. The big hit is in new apartment builds; those numbers almost halved last financial year.
Some good news though for new land sales outside Melbourne. After months of horror stories about buyer defaults, resi land developer Villawood Properties has reported a bumper month with 97 block sales in Melbourne and Geelong in July.
Household income value going backwards
The latest Household, Income and Labour Dynamics Australia (HILDA) survey was released this week. Adjusted for inflation, the average household income has dropped $542 to $80,095 in 10 years. The decade before that, average household incomes jumped by thousands a year.
With HILDA showing such stagnation, it's little wonder there's less cash being splashed around the place. This ABC article also carries a graph provided by Fidelity International showing the rising costs to consumers of essential services since 2000; while a lot of discretionary items and consumer goods have decreased in price, the big items - such as housing (+94 per cent) have risen dramatically.
With all this as the backdrop, the latest ABS inflation report due to be released at 11:30am today (Wednesday) is going to be watched closely by economists; futures markets are already tipping the results of this report will lead to the Reserve Bank cutting rates for a third consecutive month when it meets next Tuesday. Watch this space.
Opal Tower owners sue NSW government
In what will no doubt be the first of many such actions, owners of apartments in Opal Tower have joined together in a class action against the NSW government. They're seeking compensation for retrospective rental income, future predicted rental losses, and the loss in apartment values after the building was evacuated on Christmas Eve 2018 due to structural defects.