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Monthly Chart Pack Our Insights. Your Story. June 2021

Residential Real Estate Underpins Australia’s Wealth RESIDENTIAL REAL ESTATE

$8.4 Trillion AUSTRALIAN SUPERANNUATION

$3.1 Trillion AUSTRALIAN LISTED STOCKS

$2.7 Trillion COMMERCIAL REAL ESTATE

$963 Billion Data as at June 2021.

10.6 million

$1.9 trillion

53.0%

553,583

$337 billion

Number of dwellings

Outstanding mortgage debt

Household wealth held in housing

Total sales p.a.

Gross value of sales p.a.

Source: CoreLogic, APRA, RBA, ABS, ASX

In the three months to May, national home values rose 7.0%, which is the highest quarterly growth rate since November 1988 Rolling quarterly change in dwelling values Combined Capitals

Combined Rest of State

Change in dwelling values, three months to May 2021 Australia Combined regionals Combined capitals

7.0% 6.5% 7.1%

6% Regional NT Regional TAS Regional WA Regional SA Regional QLD Regional Vic Regional NSW

4% 2% 0%

-2% -4% May 11

May 13

May 15

May 17

May 19

May 21

Canberra Darwin Hobart Perth Adelaide Brisbane Melbourne Sydney

6.1% 6.8%

1.8% 2.7% 6.1% 6.2% 7.8% 6.5% 7.9% 7.7%

3.8% 5.4% 6.2% 5.5% 9.3% Source: CoreLogic

Regional dwelling values are 15.2% higher over the year, compared with a 9.4% lift in the combined capital cities dwelling market Change in dwelling values, twelve months to May 2021

Rolling annual change in dwelling values Combined Capitals

Combined Rest of State

Australia Combined regionals Combined capitals

20%

Regional NT Regional TAS Regional WA Regional SA Regional QLD Regional Vic Regional NSW

10%

-10% May 11

May 13

May 15

May 17

May 19

May 21

Canberra Darwin Hobart Perth Adelaide Brisbane Melbourne Sydney

10.6% 15.2%

9.4% 9.0% 18.1% 0.0%

12.4% 14.6% 13.1% 18.6% 15.6% 20.3% 16.5% 8.5% 11.8% 10.6% 5.0% 11.2% Source: CoreLogic

In the three months to May, the largest capital cities continued to show the ‘high’ end of market values outpacing lower value tiers Growth in stratified hedonic dwellings index (3 months) 12.4%

12.0%

9.9% 7.5%

7.5% 6.5%

5.2%

3.5%

8.2% 6.6%

6.5%

5.8%

5.1%

9.1% 7.9%

4.7% 4.7% 3.4%

4.1%

6.1%

4.7%

3.5% 3.9%

3.5%

25th 50th 75th 25th 50th 75th 25th 50th 75th 25th 50th 75th 25th 50th 75th 25th 50th 75th 25th 50th 75th 25th 50th 75th SYD

MELB

BRIS

ADL

PER Middle 50% of values

HOB

DAR

ACT

Highest 25% of values Source: CoreLogic

Every capital city is recording a rapid rate of appreciation in home values, ranging from a quarterly rise of 9.3% in Sydney to 3.8% in Perth Sydney

Melbourne

Brisbane

Adelaide

12%

Perth

Darwin

ACT

12%

10%

9.3%

6.2%

5.5% 5.4%

10%

7.9% 7.7% 6.5%

3.8%

-2%

-4%

-6% May 16

Hobart

May 17

May 18

May 19

May 20

May 21

-6% May 16

May 17

May 18

May 19

May 20

May 21 Source: CoreLogic

Rolling 28-day growth rate in CoreLogic Home Value index - combined capital cities 3.0%

2.5%

2.1% 2.0%

1.5%

1.0%

After easing through April, the 28-day rolling change in the CoreLogic Home Value index once again accelerated through May.

0.5%

31 May 21

03 May 21

05 Apr 21

08 Mar 21

08 Feb 21

11 Jan 21

0.0%

Source: CoreLogic

Quarterly and annual change in dwelling values - Sydney Quarterly Change

Annual Change

 Sydney dwelling values rose 3.0% in May

20%

 Dwelling values increased 9.3% in the quarter

15%

 Sydney dwelling values are up by 11.2% in the past year

10%

 Sydney dwelling values are currently at a record high

-5%

-10%

-15% May 16

May 17

May 18

May 19

May 20

May 21 Source: CoreLogic

Quarterly and annual change in dwelling values - Melbourne Quarterly Change

Annual Change

 Melbourne dwelling values rose 1.8% in May

20%

 Dwelling values increased 5.5% in the quarter

15%

 Melbourne dwelling values increased 5.0% in the past year

10%

 Melbourne dwelling values are currently at a record high

-5%

-10%

-15% May 16

May 17

May 18

May 19

May 20

May 21 Source: CoreLogic

Quarterly and annual change in dwelling values - Brisbane Quarterly Change

 Brisbane dwelling values increased by 2.0% in May

Annual Change

15%

 Dwelling values increased 6.2% over the quarter

10%

 Brisbane dwelling values are up by 10.6% in the past year  Brisbane dwelling values are currently at a record high

-5% May 16

May 17

May 18

May 19

May 20

May 21 Source: CoreLogic

Quarterly and annual change in dwelling values - Adelaide Quarterly Change

Annual Change

15%

 Adelaide dwelling values increased 1.9% in May  Dwelling values rose 5.4% in the quarter

10%

 Adelaide dwelling values were up by 11.8% in the past year  Adelaide dwelling values are currently at a record high

-5% May 16

May 17

May 18

May 19

May 20

May 21 Source: CoreLogic

Quarterly and annual change in dwelling values - Perth Quarterly Change

 Perth dwelling values increased 1.1% in May

Annual Change

10%

 Dwelling values increased 3.8% in the quarter

 Perth dwelling values were up 8.5% in the past year  Perth dwelling values are now -14.2% below the record high, which was in June 2014

-5%

-10% May 16

May 17

May 18

May 19

May 20

May 21 Source: CoreLogic

Quarterly and annual change in dwelling values - Hobart Quarterly Change

Annual Change

20%

 Hobart dwelling values increased 3.2% in May  Dwelling values increased 7.7% in the quarter

15%

 Hobart dwelling values are up by 16.5% in the past year

10%

 Hobart dwelling values are currently at a record high

-5% May 16

May 17

May 18

May 19

May 20

May 21 Source: CoreLogic

Quarterly and annual change in dwelling values - Darwin Quarterly Change

Annual Change

25%

 Darwin dwelling values increased 2.7% in May  Dwelling values rose 7.9% in the quarter

20%

 Darwin dwelling values were up 20.3% over the year

15% 10%

 Darwin dwelling values are -17.4% below the record high, which was in May 2014

5% 0%

-5% -10% -15% May 16

May 17

May 18

May 19

May 20

May 21 Source: CoreLogic

Quarterly and annual change in dwelling values - ACT Quarterly Change

 ACT dwelling values increased 1.7% in May

Annual Change

20%

 Dwelling values were up 6.5% in the quarter

15%

 ACT dwelling values were up by 15.6% in the past year

10%

 The ACT dwelling values are currently at a record high

-5% May 16

May 17

May 18

May 19

May 20

May 21 Source: CoreLogic

CoreLogic estimates sales volumes increased 33.1% nationally over the twelve months to May, with sales volumes sitting well above the 5-year average Monthly sales with six month moving average, National

Annual change in sales volumes May 21

70,000

National Combined regionals Combined capitals

60,000

Regional NT Regional TAS Regional WA Regional SA Regional QLD Regional Vic Regional NSW

5-year average

50,000

40,000 30,000

49.7%

7.6% 74.2% 56.1% 53.8% 36.2% 42.9%

Canberra 22.6% and are Note: recent months are modelled estimates, Darwin 27.2% therefore subject to revision

20,000 10,000 0 May 16

33.1% 45.8% 25.8%

May 17

May 18

May 19

May 20

May 21

Hobart Perth Adelaide Brisbane Melbourne Sydney

-1.3%

51.5% 21.7% 38.5% 12.7% 24.9% Source: CoreLogic

National rent values have risen 5.6% in the year to May, which is the fastest annual increase since February 2009 Annual change in rental rates - National

Annual change in rental rates to May 21 National Combined regionals Combined capitals

5.6% 10.6% 3.8%

5.6% Regional NT Regional TAS Regional WA Regional SA Regional QLD Regional Vic Regional NSW

5% 4% 3%

2% 1% 0% May 16

May 17

May 18

May 19

May 20

May 21

Canberra Darwin Hobart Perth Adelaide Brisbane Melbourne Sydney

-1.0% 11.4% 13.1% 7.4% 11.8% 7.2% 10.2% 6.7%

19.9% 7.2% 16.3%

6.6% 6.1% -2.4% 1.6% Source: CoreLogic

Gross rental yields have compressed 27 basis points nationally, to a record low of 3.48%. Perth and Darwin remain the only capital city regions where yields are higher year on year. Gross rental yields

Gross rental yields, May 2021

4.5%

National Combined regionals Combined capitals

4.0%

Regional NT Regional TAS Regional WA Regional SA Regional QLD Regional Vic Regional NSW

3.5%

3.48%

3.0%

2.5% May 16

May 17

May 18

May 19

May 20

May 21

Canberra Darwin Hobart Perth Adelaide Brisbane Melbourne Sydney

3.5% 4.6% 3.2% 6.3% 4.8% 6.2% 5.5% 5.0% 4.0% 4.2% 4.3%

6.0% 4.4% 4.4% 4.3% 4.2% 2.9% 2.6% Source: CoreLogic.

In the 3 months to May 2021, median time on market across Australia fell to 28 days, down from 42 days in the same period of 2020 Median days on market Combined capitals

Median days on market May 20 v May 21 National Combined regionals Combined capitals

Combined regionals

28 33 25

50 40 30

20 10

0 May 16

May 17

May 18

May 19

May 20

May 21

Canberra Darwin Hobart Perth Adelaide Brisbane Melbourne Sydney

36 70

Regional NT Regional TAS Regional WA Regional SA Regional QLD Regional Vic Regional NSW

38 35 39

52 34 28 30

54 43 57

35 36

21 13 17 32

43 25 41 28 31 24 33

49 May-21 May-20

Source: CoreLogic

Nationally, the rate of vendor discounting has tightened by 133 basis points over the year to May Median vendor discount May 20 v May 21

Median vendor discount Combined capitals

Combined regionals

-2%

National Combined regionals Combined capitals Regional NT Regional TAS Regional WA Regional SA Regional QLD Regional Vic Regional NSW

-3%

-4%

-5%

-6% May 16

May 17

May 18

May 19

May 20

May 21

Canberra Darwin Hobart May-21 Perth Adelaide May-20 Brisbane Melbourne Sydney

-4.0%

-4.2% -3.8%

-6.6%

-2.7% -2.7% -2.7%

-3.3% -3.9% -2.4% -3.5% -3.3% -3.5%

-4.9%

-3.2%

-4.7%

-3.6%

-3.8%

-2.0% -2.2%

-1.9% -2.5% -3.1%

-6.0%

-4.5%

-1.6% -3.1% -2.6%

-2.9% -3.2% -2.8% -4.1% -2.7% -3.5% -2.4% -3.8% Source: CoreLogic

Fresh listings to the market have increased through May, and sat 14.7% above the 5-year average level for this time of year

Source: CoreLogic

However, total listings remained -23.8% below the 5-year average due to strong absorption from sales

Source: CoreLogic

New listings are elevated on volumes in the equivalent period of 2020, which marked national stage 2 restrictions. However, Melbourne is the only region where total listings are higher. New listings, change from equivalent period last year National Combined Capital Cities Combined Regional Sydney Melbourne Brisbane Adelaide Perth Hobart Darwin Canberra Rest of NSW Rest of Vic Rest of Qld. Rest of SA Rest of WA Rest of Tas Rest of NT

68.3% 75.8% 55.1% 71.8% 84.3% 51.4% 56.6% 114.4% 17.6% 130.9% 77.1% 45.9% 64.4% 53.3% 61.4% 84.6% 48.9% 63.4%

Total listings, change from equivalent period last year National Combined Capital Cities Combined Regional

Sydney Melbourne Brisbane Adelaide Perth Hobart Darwin Canberra Rest of NSW Rest of Vic Rest of Qld. Rest of SA Rest of WA Rest of Tas Rest of NT

-19.8% -6.4% -33.6%

-3.5% 11.7%

-23.8% -20.6% -5.3% -30.4% -20.8% -24.6% -42.5% -31.4% -28.1% -41.3% -28.4% -39.0% -28.0%

Source: CoreLogic. Listings data is based on a 4-week count to 30th of May, and the equivalent period of 2020.

Auction clearance rates faded since the end of March but remain well above average. In the four weeks to May 30th, the combined capital cities clearance rate averaged 75.8%. Weekly clearance rates, combined capital cities

Source: CoreLogic

Detached housing approvals hit a fresh record high in April, rising 3.4% in the month to 15,160. Unit approvals fell -28.6% to 6,321. Monthly house v unit approvals, National 14,000 12,000 10,000 8,000 6,000

4,000 2,000 Apr 91

houses units Apr 96

Apr 01

Apr 06

Apr 11

Apr 16

Apr 21

Source: CoreLogic, ABS

Monthly value of new finance commitments, total ($ billions)

Portion of new lending for investment housing (excluding refinance) 50%

$28

45%

$23

40% $18 35.3%

35%

In April, owner-occupier finance commitments for the purchase of property rose 4.3%. This was led by a 7.0% rise in finance to owner-occupier, nonfirst home buyers. First home buyer finance fell 1.9%, the third consecutive month of decline.

$13 30% $8

25.9%

25%

Apr 21

Apr 19

Apr 17

Apr 15

Apr 13

20% Apr 11

Apr 21

Apr 19

Apr 15

Apr 13

Apr 11

Apr 17

Owner occupiers Investors

Investor lending rose 2.1% in April, which marks the 6th consecutive month of increases across this segment. Source: CoreLogic, ABS

First home buyer finance, as a portion of lending to owner occupiers, fell nationally to 29.1%, but remains above the decade average of 24.0% First home buyers as a portion of owner-occupier finance commitments (values) 60%

NSW

Vic

Qld

Tas

First home buyers as a % of owner occupier housing finance commitments ACT

50%

27.6%

NT 40%

Tas

24.1%

30%

SA 20%

Qld Vic

10%

NSW 0% Apr 11

35.6%

Apr 13

Apr 15

Apr 17

Apr 19

Apr 21

Aust

38.3% 28.1% 29.5% 31.7% 26.9% 29.1%

Source: CoreLogic, ABS

Through the month of April, lending to investors increased proportionally across QLD, SA, WA and the NT Investors as a portion of total value of lending (excluding refinancing)

Investors as a % of housing finance commitments by state 25.9%

30.6%

24.4%

25.7%

22.1%

17.8%

20.7%

21.3%

24.6%

Aust

NSW

Vic

Qld

Tas

ACT

Source: CoreLogic, ABS

RBA cash rate

The RBA held rates at 0.1% through June

18% 16%

Statement highlights

14%

- No change to the targets of 10 basis points for the cash rate or the 3-year Government bond yield.

12%

- Final drawings for the Term Funding Facility will finish on the 30th of June. $134 billion has been drawn by ADIs so far, and will support low borrowing costs until 2024.

10% 8%

6% 30yr avg, 4.37%

- The board will discuss a shift in the maturity of yield curve control from April 2024 to November 2024 in July.

4% 20yr avg, 3.56%

10yr avg, 1.98% 0.10%

Jun 20

Jun 15

Jun 10

Jun 05

Jun 00

Jun 95

Jun 90

- On housing, the RBA noted there has been “increased borrowing by investors”, while reiterating that trends in housing borrowing are being “carefully” monitored, to see that lending standards are maintained. Source: CoreLogic, RBA

Average home lending rates continued to decline through April Average housing lending rates for new loans have declined 4 basis points for owner occupiers, and 4 basis points for investors through the month of April Average borrowing costs by borrower and loan type, as at 30 Apr 21

>=81% LVR <81% LVR Principal & interest Interest only >3 years fixed 3 years or less fixed Variable rate Principal & interest Interest only >3 years fixed 3 years or less fixed Variable rate

2.81% 2.79% 2.69% 2.95% 2.42% 2.42% 3.06% 3.15% 3.52% 2.36% 2.92% 3.44%

4.5%

>=81% LVR <81% LVR Principal & interest Interest only >3 years fixed 3 years or less fixed Variable rate Principal & interest Interest only >3 years fixed 3 years or less fixed Variable rate

2.47% 2.41% 2.35%

3.0%

3.5%

3.22%

Owner occupier - existing loans Owner occupier - new loans Investor - existing loans Investor - new loans

2.5%

2.77% 2.86%

Apr 21

2.0% Oct 20

3.71% 2.11% 2.55% 3.10%

Apr 20

2.05% 1.98%

4.0%

Oct 19

New loans Existing loans New loans Existing loans

Owner occupiers

Investors

Average borrowing costs by borrower and loan type, as at 30 Apr 21

Source: CoreLogic, RBA

Could we see another round of credit tightening? Riskier types of lending are rising, but probably not enough to trigger a regulatory response yet…. regulators and policy makers are likely to be watchful for any signs of slippage in lending standards.

Mar 2019 Jun 2019 Sep 2019 Dec 2019 Mar 2020 Jun 2020 Sep 2020 Dec 2020

Dec 2020

Jun 2020

Sep 2020

13%

12.0% 12.0% 11.7% 12.0% 12.4% 11.5% 13.0% 14.1%

2.8% 2.8% 4.5% 4.5% 4.6% 3.9% 4.5% 5.1%

16% 14% 12% 10% 8% 6% 4% 2% 0%

Mar 2019 Jun 2019 Sep 2019 Dec 2019 Mar 2020 Jun 2020 Sep 2020 Dec 2020

14.8% 14.6% 15.1%

16.4% 16.3% 16.0% 16.3% 17.2%

7.0%

6.0%

5.7%

6.1%

5.6%

4.8%

4.9%

17%

14% Mar 2020

Mar 2019 Jun 2019 Sep 2019 Dec 2019 Mar 2020 Jun 2020 Sep 2020 Dec 2020

16%

18%

15%

Dec 2019

17%

% of loans originated with an LVR >=90%

% of loans originated with a DTI ratio >=6x

16%

Sep 2019

18%

8% 7% 6% 5% 4% 3% 2% 1% 0%

Jun 2019

19%

% of loans originated with a LTI ratio >=6x

Mar 2019

20%

18.2% 17.5% 18.0% 17.9% 18.5% 19.2%

21%

19.5% 20.4%

% of loans on interest only terms

Owner occupiers

Source: CoreLogic, APRA

Disclaimer In compiling this publication, RP Data Pty Ltd trading as CoreLogic has relied upon information supplied by a number of exter nal sources. CoreLogic does not warrant its accuracy or completeness and to the full extent allowed by law excludes liability in contract, tort or otherwise, for any loss or damage sustained by subscribers, or by any other person or body cor porate arising from or in connection with the supply or use of the whole or any part of the information in this publication through any cause whatsoever and limits any liability it may have to the amount paid to CoreLogic for the supply of such information. Queensland Data Based on or contains data provided by the State of Queensland (Department of Natural Resources and Mines) 2021. In consideration of the State permitting use of this data you acknowledge and agree that the State gives no warranty in relation to the data (including accuracy, reliability, completeness, currency or suitability) and accepts no liability (including without limitation, liability in negligence) for any loss, damage or costs (including consequential damage) relating to any use of the data. Data must not be used for direct marketing or be used in breach of the privacy laws. South Australian Data This information is based on data supplied by the South Australian Government and is published by permission. The South Australian Government does not accept any responsibility for the accuracy or completeness of the published information or suitability for any purpose of the published information or the underlying data. New South Wales Data Contains property sales information provided under licence from the Land and Property Information (“LPI”). CoreLogic is authorised as a Property Sales Information provider by the LPI. Victorian Data The State of Victoria owns the copyright in the Property Sales Data which constitutes the basis of this report and reproduction of that data in any way without the consent of the State of Victoria will constitute a breach of the Copyright Act 1968 (Cth). The State of Victoria does not warrant the accuracy or completeness of the information contained in this report and any person using or relying upon such information does so on the basis that the State of Victoria accepts no responsibility or liability whatsoever for any errors, faults, defects or omissions in the information supplied. Western Australian Data Based on information provided by and with the permission of the Western Australian Land Information Authority (2021) trading as Landgate. Australian Capital Territory Data The Territory Data is the property of the Australian Capital Territory. No part of it may in any form or by any means (electronic, mechanical, microcopying, photocopying, recording or otherwise) be reproduced, stored in a retrieval system or transmitted without prior written permission. Enquiries should be directed to: Director, Customer Services ACT Planning and Land Authority GPO Box 1908 Canberra ACT 2601. Tasmanian Data This product incorporates data that is copyright owned by the Crown in Right of Tasmania. The data has been used in the product with the permission of the Crown in Right of Tasmania. The Crown in Right of Tasmania and its employees and agents: a) give no warranty regarding the data's accuracy, completeness, currency or suitability for any particular purpose; and b) do not accept liability howsoever arising, including but not limited to negligence for any loss resulting from the use of or reliance upon the data. Base data from the LIST © State of Tasmania http://www.thelist.tas.gov.au 18 July © 2019 CoreLogic, Inc. All Rights Reserved.

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