The Heart of Melbourne Property
Boroondara Property Review April 2022
WHAT’S IN STORE FOR THE HOUSING MARKET IN 2022? Eleanor Creagh, Senior Economist at REA Group
UNDERSTAND THE HOME DOWNSIZER CONTRIBUTION STRATEGY Alex Swansson, Head of Superannuation at Partners Wealth Group
RECENT SALES SUCCESS
CONGRATULATIONS TO OUR BOROONDARA COMMUNITY AWARD WINNERS Read about our six winners
4 Airley Road, Glen Iris SOLD
30 Years
WHAT’S IN STORE FOR THE HOUSING MARKET IN 2022? ELEANOR CREAGH Senior Economist at REA Group
After a record-breaking year last year, there’s plenty on the horizon for property markets in 2022. Let’s explore key trends.
Strong demand, a constrained supply of properties for sale, and record-low
But the real driving force was the ongoing reassessment of lifestyle wants and housing needs by Australians, which when combined with the cheap cost of borrowing, allowed many to afford larger mortgages and bigger budgets. The arrival of the Omicron strain is a timely reminder that despite our best efforts, predicting the year ahead is often an exercise fraught with uncertainty. Still, we look at what could be some of the big themes that may drive residential real
MORE CHOICE AND LESS COMPETITION, it started. There were three consecutive months of elevated new listings, with November bringing a decade high for new listings in capital cities. The easing of COVID buyers took advantage of the choice available. This trend has continued into the new year and across capital cities January
price growth, meaning some buyers can expect the intense levels of competition
Greater willingness from sellers to list their properties will mean more choice and an improved balance between supply and demand. This should also contribute to easing price growth this year.
IT’S AN UPGRADER’S MARKET: Equity gains a tailwind for activity Remote work arrangements and the experience of lockdowns have seen many housing prices, many existing homeowners are sitting on substantial equity. This combination is likely to add to strength in upgrader transaction volumes, especially as the shift in lifestyle preferences is still being compounded. The emergence of Omicron has further prolonged remote work necessity. As cases subside, this year will hopefully be less hindered by restrictions, and buyers and sellers who have held back until now will have the opportunity to transact unencumbered – providing another tailwind for activity. However, the price gap between units and houses, which has widened this year,
INVESTORS REMAIN ACTIVE: Future landlords looking around
we could see increased demand for units. The proportion of enquiries to real estate agents from investors is currently at the highest level seen in more than two years. Since investor loans typically have higher interest rates, APRA’s increase to the serviceability buffer applied to new home loan applications will impact investors more than owner occupiers. With this in mind, and units currently historically cheap relative to houses, the added pressure in rental markets and affordability factors could drive demand.
SLOWING PRICE GROWTH, Price growth to slow from the breakneck speeds
Already high home prices, along with bottoming mortgage rates, will slow annual price growth. Savings made from lower interest rates were very quickly absorbed by higher housing prices and that commensurate boost to affordability from low rates is expiring.
conditions, investors may look to capitalise on rental recovery and the unit discount. INTEREST RATES: Wages growth MIA
demand for property and seeing housing prices surge Australia-wide as a result. Australian Prudential Regulation Authority’s macroprudential changes, which took effect late last year, have moderately reduced borrowing capacity for new buyers. But even as last year’s runaway surge eases, annual price growth in the coming year is still likely to match or exceed long-term trends.
This would see mortgage rates increasing and borrowing costs headed higher, thus reducing the amount people can borrow – a handbrake on price growth. However, before the RBA raises rates, governor Philip Lowe has consistently
(what the RBA is seeking) – and currently the missing link. Crucially, the RBA that faster-than-expected progress continues to be made if the labour market until there is evidence of broad-based stronger wages growth, don’t expect interest rates to rise. The RBA is also likely to wait for at least two more strong possible in that respect.
rates are likely to rise regardless. Fixed rates have already bottomed, and variable rates are likely to creep higher this year. Even though mortgage rates are likely
| Boroondara Property Review
105 Kenmare Street, Mont Albert North SOLD
11 Florence Road, Surrey Hills SOLD
10-12 Trafalgar Road, Camberwell SOLD
4 Vicars Street, Hawthorn SOLD
13 Carrington Street, Hawthorn SOLD
6 Lambourne Street, Surrey Hills SOLD
23 Muir Street, Hawthorn 3 Sercombe Grove, Hawthorn SOLD SOLD
10 Thomas Street, Kew SOLD
1 Lytton Street, Kew SOLD
86 Mountain View Road, Balwyn North SOLD
16 Queens Parade, Glen Iris SOLD
SOLD
UNDERSTAND THE HOME DOWNSIZER CONTRIBUTION STRATEGY ALEX SWANSSON Head of Superannuation at Partners Wealth Group
– never been more important. Knowing who to talk to, which are the most suitable decisions you should be making now and into the future can be overwhelming for some.
– sale. –
Your home is in Australia and is not a caravan, houseboat or other mobile home.
most recent legislation changes that will now allow people from the age of 60 to contribute a portion of the sale of their residential home into their superannuation.
–
The proceeds (capital gain or loss) from the sale of the home are either exempt or partially exempt from capital gains tax (CGT).
Downsizer Super Contribution soon to become available to 60-year-olds.
–
Government’s “downsizer contribution” offer, enabling them to contribute up to $300,000 into their superannuation from the sale of their residential home. In
contribution. – proceeds of sale, which is usually at the date of settlement.
available to people from the age of 60 instead of 65.
–
You have not previously made a downsizer contribution to your super from the sale of another home.
A downsizer contribution is a lump-sum contribution to your superannuation resulting from the sale of your home. It is a good strategy to consider if you want to
Are there any restrictions?
–
also entitled to contribute to their super.
You and your spouse can make a downsizer contribution of up to $300,000 each without needing to pass the work test.
There are no balance restrictions on contributing to superannuation, so members
towards your contributions caps.
Please note that for social security purposes, your superannuation interest is an assessable asset and subject to deeming once you are over pension age. There is no social security concession for the downsizer contributions. If affected, we suggest
fund.
Want to know more?
– – – –
Even if your house was owned by one spouse, both spouses can contribute up to $300,000 each. You don’t need to actually downsize your house. So long as the proceeds of the sale are used to contribute to your super, you are not required to buy a smaller house. In fact, you can upsize your house with your separate funds.
Am I eligible?
about how you can utilise the Downsizer Super Contribution to maximise your email bsavige@pwg.com.au
this information.
There are a few conditions that need to be met to be eligible for the downsizer contribution: –
The amount you are contributing must be from the proceeds of selling your home. Boroondara Property Review | 3
Congratulations to our Boroondara Community Award Winners Over the last few months, the team at Jellis Craig Boroondara had a wonderful experience reaching out to our Boroondara community and seeing the local love of many businesses, families, health and wellbeing facilities and educators. When reading the many stories of the nominees, it was clear that our Boroondara The Jellis Craig Boroondara Community Awards provide a platform to celebrate, acknowledge and reward the hard work of our locals in the community. We are very excited to announce the winners! Rev. Natalie Dixon-Monu has won the Jellis Craig Boroondara Community People’s Award, for her endless devotion and unfathomed passion to all thing’s social justice, as coordinator at the Boroondara Community Outreach Centre. William Chandler, winner of the Jellis Craig Boroondara Community Neighbourhood/Village Award has been an instrumental part of the Surrey Hills history and much of what local neighbours, individuals and groups enjoy about Surrey Hills is directly attributed to the early visionaries of the area, William being a key component. Daniel Evans has been awarded the Jellis Craig Boroondara Community Local
Camberwell Hockey Club (CHC) are the winners of the Jellis Craig Boroondara training to their skill set, CHC strive to provide an empowering environment for the Boroondara community to compete and play their beloved sport of Hockey. Val Macaro as the Jellis Craig Boroondara Community , is a care worker (superwoman to say the least). Val’s strength, determination and resilience is admirable, not only in the eyes of her family but to the Boroondara Community. James and Cat Laskie, the dynamic brother and sister duo of Barton Milk Bar Hawthorn are the Jellis Craig Boroondara Community Business Award Winners. The whole team were able to bring together an entire community that left residents of Boroondara feeling “a sense of security and joy” during and post Melbourne’s lockdowns. After 30 years in Boroondara, Jellis Craig wanted to recognise those that have contributed to making the community a better place to live. Special thanks to those individuals that took the time to send in their nominations. Congratulations to our winners and nominees for all that they do and continue to do that makes our community so special. They truly are the heart of Boroondara.
you’ll always love the job you do. Daniel has been a mentor and an extraordinary example of resilience and perseverance during a time of uncertainty to his fellow colleagues and students.
Local Business Award
Local Educator Award
Health & Wellbeing Award
BARTON MILK BAR
CAMBERWELL SOUTH PRIMARY SCHOOL
CAMBERWELL HOCKEY CLUB
James and Cat provided locals a sense of security and joy during and post Melbourne’s lockdowns.
Daniel is more than just a sports teacher, he has been a mentor to his students.
Not only a hockey club, they provided mental health
Local Village Award
People’s Choice Award
Family Award
BOROONDARA COMMUNITY OUTREACH
WILLIAM CHANDLER
VAL MACARO
Rev. Natalie has provided endless support to people who are socially isolated or living with a mental illness.
Nominated for his massive contribution to the suburb of Surrey Hills for more than 44 years.
Nominated by her 5 children, Val is the backbone of her family, balancing work and home schooling
To read more, visit jelliscraig.com.au/awards
Balwyn | Glen Iris | Hawthorn Jellis Craig Boroondara P jelliscraig.com.au If your property is exclusively listed with another agent, please disregard this communication
30 Years