Residential

QBE Australian Housing Outlook 2017 – 2020
BIS Oxford Economics for QBE Lenders’ Mortgage Insurance
October 2017

This report provides an analysis and forecast of the key drivers influencing the residential housing market nationally, as well as across each of Australia’s state and territory capital cities and selected regional centres. The analysis presents an outlook for the performance of the residential  market, as measured by historical and forecast movement in the median house price and median unit price.

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Housing Australia
CEDA
August 2017

CEDA’s aim in drawing together this report is to take a holistic review of housing in Australia.

Key areas examined in this report include:

  • Housing trends in Australia;
  • The experience of Australia’s housing sector compared with other countries in

the OECD;

  • Supply of housing: from land availability to changes in the composition of

housing stock;

  • Drivers of demand and possible policy levers; and
  • The intergenerational consequences of high housing costs and falling home ownership.

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Is the current period of price movement unusual?
Dr Nigel Stapledon
August 2017

This chapter provides a comparison of the local housing experience with that of other countries in the Organisation for Economic Co-operation and Development (OECD). It looks at price cycles of the last 50 years across Australia’s major cities and explores the factors that have contributed to the booms and busts.

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A Fixed Abode – The Opportunity for Institutional Investors to Play a Part in improving the private rental market
PWC
June 2017

Australia currently sees one third of its population in the rental market – and this statistic is much higher in our capital cities and amongst younger Australians. Out of this, 40% of overall renters are considered ‘long-term’, holding this status for at least 10 years. A recent survey of 600 Australians and detailed interviews with 60 long-term renters in Sydney and Melbourne found long-term renters expressed regret about not being a home owner – with a mix of Australian cultural (‘Great Aussie Dream’) reasons and logistical reasons. So why is renting in Australia seen as the last resort and something to be done in the short term only? Why does it seem to be the antithesis of the ‘Great Aussie Dream’?

In remaining fixated on home ownership, are we holding our gaze on an unattainable goal? We need to shift the conversation to be about a person having access to housing and the ability to make choice in terms of that housing to suit their needs at that stage of life. A person needs to be provided with the stability that enables them to make the house they are living in their home. Even if they don’t own it. A strong enabler for security and better conditions of tenure could be to restructure market rental provision through tax concessions and other measures that entice institutional investors to build properties and hold them over the long term for rental – this is known as ‘Build to Rent’ housing (BTR). A Fixed Abode proposes a shift in conversation about Australia’s rental market and suggests how investment and Government support can bring stability to the rental experience.

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The Downsizing Dilemma
LJ Hooker
July 2017

While first home buyers in numerous states have been given stamp duty concessions from their respective governments, recent research shows the tax is a challenge for older purchasers, as well.

The Downsizing Dilemma, a White Paper produced by LJ Hooker and Downsizing.com.au, found stamp duty was the biggest obstacle for older Australians downsizing from the family home. In turn, stamp duty is preventing family houses – and many unused bedrooms – from being freed up and purchased by  first, second and third home buyers, which would improve affordability across the wider marketplace.

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The Future of Chinese Residential Developers in Australia
April 2017
JLL

​ JLL conducted analysis into the 10 largest residential developers yet to enter the Australian market. A key driver for these developers will be the health of the foreign retail buyer market for new apartments in Australia. The next wave of Chinese residential developers in the Australian apartment market are likely to have more capital, come from China’s Tier 1 cities and will have more experience delivering projects outside of China.

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Housing, multi-level governance and economic productivity
AHURI
June 2017

This AHURI study investigated appropriate frameworks to better understand the way in which housing policy mechanisms contribute to economic productivity and growth. It reviewed the literature, key Federal Government policy statements and reports released over the past decade; analysed the mechanisms through which housing policy influences economic behaviour; and tested such frameworks to better comprehend these processes.

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Build to Rent
Knight Frank
April 2017

According to the 2011 Census there were 2,297,458 rented dwellings across Australia (30% of all dwellings), up 14% from 2006. Knight Frank projects that NSW, Vic and Qld will have approximately 31%, 30% and 33% of all households privately rented from a landlord by 2019/20 – up approximately 5% on current levels. A Build-to-Rent sector, institutionally built and owned private rented accommodation, could emerge in the same way that the purpose built student accommodation sector is developing.
Availability of suitable sites, viability against other uses, low rental yields, and high build costs are all factors currently weighing in on the growth of the sector.

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Housing Affordability Report
December 2016
CoreLogic

The CoreLogic Affordability Report provides valuable insights, particularly when analysed over time. However, it is important to remember that the analysis considers the median household income and dwelling prices, and therefore may not capture all household demographics such as single income families, the quality of housing and housing size.

This report includes four measures of housing affordability, including rental affordability, which show different outcomes. The commonality across each measure is that housing affordability shows substantial diversity from region-to-region, and across product types.

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House Prices, Household Debt And Labour Supply In Australia
Kadir Atalay; Garry Barrett; Rebecca Edwards (AHURI)
July 2016

The objective of the research presented in this report is to identify the nature and magnitude of the relationship between house prices, household debt and the labour market decisions of Australian households. It is well known that there is a positive relationship among house prices, household debt and labour supply, however empirical estimates of the magnitudes of this relationship in Australia are scarce. Therefore, this project analyses the link between house prices, mortgage debt, and labour supply using rich and contemporary data drawn from the Household, Income and Labour Dynamics in Australia (HILDA) survey for the period of 2001 to 2012 (waves 1–12).

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A Federal Incentives Model For Housing Supply
Deloitte Access Economics / PCA
April 2016

The Property Council of Australia commissioned Deloitte Access Economics to investigate whether an National Competition Policy style federal incentives model could be applied to stimulate improved housing outcomes, and what the benefits from an effective model could be.

The Deloitte Access Economics Paper details how Federal incentives could drive planning reform:

  • Set targets – States and the Commonwealth agree on metrics and outcome, with flexibility in the arrangements to accommodate jurisdictional differences.
  • Make someone responsible – there needs to be an entity that collects data and measures performance against targets and outcomes.
  • Model the benefits – modelling needs to be thorough to better understand the size of the revenue or economic gains.
  • Link Payments to Action– both for up-front reforms, and on an ongoing basis.
  • States to lead but involve local government– States have a responsibility to set direction, but local government should be rewarded for delivering at the granular level.

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Chinese Demand For Australian Property
RBA
April 2016

Chinese investment in Australian residential and commercial property has increased significantly in recent years. The Australian banking system’s direct exposure to Chinese property investors and developers appears to be small. However, if Chinese demand were to decline significantly, that could weigh on domestic property prices and so lead to losses on the banks’ broader property-related exposures. This paper explores these issues further.

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State Of The Land Report
UDIA
March 2016

The 2016 UDIA State of the Land report was undertaken in partnership with Charter Keck Cramer and Research4, utilising data from the National Land Survey Program (NLSP).

The 2016 UDIA Report found new greenfield residential lots released for sale nationally in 2015 increased by 9.9% compared to 2014, driven primarily by a record level of activity in Melbourne. The State by State analysis clearly demonstrates that in states where supply of lots increased markedly, prices either rose modestly or fell. This is demonstrated in Melbourne and South East Queensland, where lot releases were up by 53.3% and 4.8% respectively, while the median lot price rose by only 3.8% in Melbourne and 4.5% in South East Queensland. In Adelaide, a rise in lot releases of 11.4% between 2014 and 2015 was accompanied by a 2.3% fall in the median lot price. Meanwhile in Sydney, the median lot price rose by 29.7% while lots released fell by 4.6% to 8,174 between 2014 and 2015.

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Housing Decisions Of Older Australians
Productivity Commission
December 2015

The report continues the investigation of issues relating to the ageing of Australia’s population, this time focusing on the housing choices made by older Australians. It considers available statistical evidence on the financial and accommodation aspects of housing decisions and draws out some of the policy issues affecting the wellbeing of older Australians and the broader community. The report examines the policies affecting the supply and cost of residential aged care and other age-specific housing, the influence of the tax and transfer system on housing decisions, and the issues in using home equity release to support living standards in retirement. In reaching its conclusions, the Commission drew on evidence from a survey of older Australians conducted on its behalf.

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Rental Affordability Index: Quarter 2 – 2015
National Shelter, Community Sector Banking And SGS Economics & Planning
November 2015

National Shelter, Community Sector Banking and SGS Economics and Planning have formed a partnership to develop and release the Rental Affordability Index (RAI). The RAI is intended to complement the Housing Affordability Index (HAI) developed by the Commonwealth Bank of Australia and Housing Industry Association (HIA).

National Shelter, Community Sector Banking and SGS Economics and Planning have formed a partnership to develop and release the Rental Affordability Index (RAI) on a quarterly basis. It is an easy to understand indicator of rental affordability applied to geographic areas across Australia.

It is generally accepted that if housing costs exceed 30% of a low income household’s (households with the lowest 40% of income) gross income, then that household is experiencing housing stress (30/40 rule). In the RAI, households who are paying 30% of income on rent have a score of 100, indicating that these households are at the critical threshold for housing stress. A score of 100 or less indicates that households would pay more than 30% of income to access a rental dwelling, meaning they are at risk of experiencing housing stress.

The following household types are examined in detail by the RAI:

  • Average income households
  • Family households
    • The 20% of households within the lowest household income quintile (Q1)
    • The 20% of households within the second lowest household income quintile (Q2)
  • Non-family households (primarily lone person households)
    • The 20% of households within the lowest household income quintile (Q1)
    • The 20% of households within the second lowest household income quintile (Q2)

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Perspectives On Australian Dwelling Prices
HIA
November 2015

Between April 2014 and March 2015, the pace of annual dwelling price growth across Australia’s eight capital cities had slowed from 11.5 per cent to 7.4 per cent. Over subsequent months, however, the pace of aggregate dwelling price growth again accelerated and was 10.1 per cent during October 2015. The overall growth rate masks huge variations from city to city, as demonstrated in the chart below. While dwelling prices in Sydney and Melbourne continue to grow at double digit rates in annual terms, dwelling prices have fallen in two of the eight capital cities over the past year. Generalisations about an ‘Australian property market’ and how it is performing are therefore very misleading.

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Urban Productivity And Housing 29 October 2015
Peter Seamer Metropolitan Planning Authority
October 2015

Peter presented at the National Housing Conference on Urban Productivity and Housing with a focus on Melbourne.

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Australian Residential Development Outlook
Residential Development Council / CoreLogic RP Data
October 2015

The RDC CoreLogic RP Data Australian Residential Development Outlook is a comprehensive report that provides the highlights of the fundamental indicators for the residential development market in macro, fiscal, housing investment and housing activity.

  • Macro indicators include the most recent data and expectations for: inflation, growth, interest rates, terms of trade, population, net overseas migration, unemployment, wages growth, household savings and household wealth.
  • Fiscal indicators include the most recent budgets, government forecasts and actual property activity that influences forecasts for state and territory taxation revenues.
  • Housing investment indicators include the most recent data and expectations for: construction industry confidence, demand for housing credit, house price growth, capital city home value index, premium sector values, household interest to income ratio, house price to income ratio.
  • Housing activity indicators include the most recent data and expectations for: rental rates, auction clearance rates, transaction volumes, housing finance, building approvals, building activity, first home owner levels and foreign investment in residential real estate.

The Outlook concludes with a view around national housing affordability and summarises expectations for residential development activity in calendar year 2016.

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Urban Housing Challenge: One Million New Homes One Thousand Thriving Neighborhoods
Hassell
2015

A safe, secure and affordable home is a fundamental human need. For many people, it’s the largest financial investment they will ever make. It encapsulates a personal sense of identity and provides a foundation from which individuals can build a more financially and socially secure future. Good housing also underpins an effective, functioning and prosperous city. It supports better public transport and social infrastructure – better healthcare, better systems of education, better employment opportunities. All important factors in the attraction and retention of the best global talent. With the Urban Housing Challenge report, HASSELL outlines a new model of housing design and delivery in London, Shanghai and Sydney that will help each city address the challenges that come with rapidly expanding populations. It explores the challenges of housing density, delivery and quality and how, by achieving a balance of all three, can cities become more sustainable, prosperous and liveable places.

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Housing More Expensive In The Inner City But Not Necessarily Seeing Stronger Growth
CoreLogic RP Data
Cameron Kusher
September 2015

Inner city housing has been booming. CoreLogic RP Data examine the data to see how much difference there was in terms of inner city house values and growth in these values over the past year relative to values and growth across the rest of the capital cities.

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Review Of Interest-Only Home Loans
ASIC
August 2015

This report sets out ASIC’s findings from a review of home loans with an interest-only period during the initial part of the loan (interest-only home loans). The review looked at the practices of 11 lenders who offer interest-only home loans. The review found examples of practices that place lenders at risk of breaching responsible lending obligations. The report details these findings and sets out a number of actions that Australian credit licensees (credit licensees) should take. All 11 lenders that were included in this review have agreed to implement the actions set out in this report.

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Global Capital And Relative Values of Australian Real Estate
Charter Keck Cramer
August 2015

International investment into Australian housing markets has become an increasingly significant and controversial issue. The growing participation and influence of international investors is changing the positioning of Australian residential real estate within the global context. This Charter Insight seeks to briefly explore the complex and evolving narrative of international investment into Australian residential real estate.

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Australian Housing Market Now Valued At $6 trillion
Tim Lawless – CoreLogic RP Data
August 2015

Buoyant market conditions have produced a sterling result for Australia’s property market with $2 trillion added to the market since 2009; this now brings the total value of the market to $6.0 trillion. The Australian housing market reached a new milestone in July with the overall value of housing (excluding vacant land) breaking through the $6 trillion mark. This report provides a snapshot on a State by State basis and inner versus outer rings for each of the major cities.

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How Housing Affordability Can Play A Role In Economic Development
.id – the Population Experts
August 2015

Housing affordability is typically considered a social issue and is given limited attention in many economic development strategies. Research by .id shows that if housing is no longer affordable for lower income workers or Key Workers such as teachers, nurses and cleaners, then this will have an impact on the productivity of a place because the local economy needs Key Workers to function.

This blog summarises our analysis of Key Workers in the City of Parramatta. This research points to the conclusion that there is now a need more than ever for Councils to develop urban renewal or housing strategies to combat housing affordability as a key pillar of economic development.

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Making Apartments Affordable
Andrea Sharam, Lyndall Bryant And Tom Alves – Swinburne University Of Technology
June 2015

Urban consolidation policies in Australia presuppose apartments as the new dominant housing type, but much of what the market has delivered is criticised as over-development, and as being generic, poorly-designed, environmentally unsustainable and unaffordable. In contrast to the usual focus on planning regulation and construction costs as the primary issues needing to be addressed in order to increase the supply of quality, affordable apartment housing this paper uses Ball’s (1983) ‘structure of provision’ approach to outline the key processes informing apartment development to reveal a substantial gap in critical understanding of how apartments are developed in Australia, and identifies economic problems not previously considered by policymakers.

This paper proposes three major reforms, which together would enable development of better, more affordable apartments for housing consumers:

  • Firstly, that the market for apartment development be re-designed, following insights from the economic field of ‘Market Design’ (a branch of Game Theory). A two-sided matching market for new apartments is proposed, where demand-side risks can be mitigated via consumer aggregation.
  • Secondly, consumers should be empowered through support for ‘deliberative’ and ‘do-it-yourself’ (DIY) development models, in order to increase competition, expand access, and promote responsiveness to consumer needs and preferences. A ‘Smart Housing Market’ is proposed to broker the necessary connections and simplify the process.
  • Finally, planning schemes need to impose density restrictions (in the form of height limits, floor space ratios or bedroom quotas, for example) in localities where housing demand is high, in order to dampen speculation and de-risk development by creating certainty. Restrictions on over-development on larger infill sites can be offset by permitting intensification of ‘greyfield’ suburbs. Aggregating existing housing lots to enable precinct regeneration with moderate height and density increases would permit better use of airspace thus allowing design outcomes that can optimise land use while retaining neighbourhood amenity.

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Submission To The House Of Representatives Standing Committee On Economics Inquiry Into Home Ownership Department Of Infrastructure And Regional Development
June 2015

This submission has been prepared by the Department of Infrastructure and Regional Development (the Department) to the House of Representatives Standing Committee on Economics Inquiry into Home Ownership (the Inquiry). This submission is primarily concerned with the second of the terms of reference of the Inquiry, the “demand and supply drivers in the housing market,” and has a particular focus on land use planning outcomes that affect the location of new housing development.

The submission presents the views of the Department on the relationship between housing supply in Australia’s major cities and the provision of transport services. In particular, the submission discusses:

– patterns of population density within Australia’s cities;

– forecast housing demand in Australia’s cities;

– trends in housing construction and occupancy;

– the relationships between housing location and transport demand; and

– the importance of integrated land use and transport planning.

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Submission To The Inquiry Into Home Ownership
House Of Representatives Standing Committee On Economics
RBA
June 2015

The RBA made a submission to the Federal Government’s Inquiry into Home Ownership – House of Representatives Standing Committee on Economics. The RBA’s submission is wide-ranging and provides an interesting analysis of home ownership rates, drivers of demand, drivers of supply, the proportion of investment housing relative to owner-occupied housing, impact of taxation and most importantly, opportunities for reform.

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Development Assessment Report Card
Property Council of Australia/MacroPlanDimasi
May 2015

Poor planning is holding up new housing and adding to costs for home buyers, finds the most comprehensive national assessment of Australia’s planning framework ever undertaken. The 2015 Development Assessment Report Card (3rd Edition) commissioned by the Property Council of Australia shows that more than a decade after agreeing to ten national principles for best practice development assessment, Australia’s states and territories are still lagging.

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The Opportunity Of Residential Property Investment Vehicles In Enhancing Affordable Rental Housing Supply
Graeme Newell, Chyi Lin Lee and Valerie Kupke – For The Australian Housing And Urban Research Institute
May 2015

Institutional investors currently play a negligible role in the private rental market in Australia. Their lack of involvement in the private rental sector has been described as a structural weakness in the Australian rental market, and is at variance with institutional investment in residential property in international jurisdictions. This research study investigates the effectiveness of residential investment vehicles in enhancing the supply of private rental properties in Australia and elsewhere. It explores the current opportunity to develop an effective residential investment vehicle to expand the supply of private rental housing in Australia, and to contribute to meeting Australia’s housing needs in the future.

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CoreLogic RP Data Capital Markets Report
March 2015

CoreLogic RP Data’s Capital Markets Report provides a useful insight into the key drivers of the residential markets across Australia.

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11th Annual Demographia International Housing Affordability Survey: 2015
Demographia
January 2015

The 11th Annual Demographia International Housing Affordability Survey covers 378 metropolitan markets – including 86 major metropolitan markets with a population of more than 1 million – in nine countries (Australia, Canada, China, Ireland, Japan, New Zealand, Singapore, the United Kingdom and the United States).

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Infrastructure Investment And Housing Supply
SGS Economics And Planning
June 2013

Recent Australian research suggests that improving the connectivity of housing developable land, whether this be situated in the established urban footprint or on the urban fringe, may improve the housing yield from these areas. This is premised on the hypothesis that households will be prepared to give up some space in return for better access to employment and service opportunities.

The research method focussed on two metropolitan case examples –Sydney and Melbourne.

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Different Places, Different Means – Why Some Countries Build More Than others
Michael Bassett And Luke Malpass – The New Zealand Initiative
June 2013

This report is a summary of international fieldwork examining different property markets and systems of local government. It examines how they interact with local regulators, how the incentives at local government level affect how houses are built, and how their planning culture has an impact upon development.

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Tomorrow’s Suburbs: Building Flexible Neighbourhoods
Jane-Frances Kelly – Grattan Institute

September 2012

The fringes of Australian cities are growing at a remarkable rate. But these new neighbourhoods won’t stay new for long. Over time, the profile and needs of their residents will change, as people move in and out, age, or their life circumstances alter in other ways. Suburbs that cannot keep up with these changes by offering different kinds of housing and services will become less desirable places to live. This report recommends ways to make our new suburbs, shopping centres and homes more adaptable to change, without imposing undue costs on current residents. The report concludes that many things can be done now to ensure that our newest suburbs are flexible enough to thrive for decades to come.

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