Things are constantly changing in real estate nationwide but the one factor that never changes is this:
we can always rely on news media to distort the facts and deliver a steady flow of misinformation to Australian consumers, all in the interests of attracting readership, with little regard for accuracy, honesty or fairness.
The past week or so has been chockful of media nonsense.
If you can believe the headlines, the national property boom is over, house prices are plunging, the rental boom is over and the North Queensland city of Townsville is a mining town.
One of the constants of my 40-plus years charting Australian real estate is that there are lines and lines of idiots scrambling to be the first to declare that a boom is over, usually long before it actually is.
This is often fed by data research entities like CoreLogic where the key people never let the facts get in the way of good headline and free publicity.
So Australia has been resplendent lately with strident headlines declaring that the national property boom is over or words to that effect.
Here’s the first problem: we don’t have a national property boom so it’s rather odd to declare that something which doesn’t exist is finished.
We have certainly had a boom in Perth, Adelaide and Brisbane among the capital cities, but certainly nothing remotely resembling a boom in the other five state and territory capitals.
It’s a similar scenario in the regional markets, with a variety of different situations ranging from downturn and stagnation to moderate growth and, in some cases, strongly rising prices.
But nationally growth in house and unit prices has averaged 6 or 7 percent throughout 2024 – and lately the annual growth rate, as a national average, has been 4 or 5 percent. Only in the fertile imaginations of media headline writers would that constitute a boom.
But, according to various media outlets, this mythical boom is over – even though the latest figures for annual growth in three of our capital cities and three of our state regional markets are still well above 10%.
The only places where the evidence suggests the boom is over are the ones where a boom never took place – like Melbourne, Hobart, Darwin and Canberra.
But not only, according to media, is the fictional national boom over, but property prices are plunging. One headline in Fairfax media claimed to reveal Why property prices are plunging across Australia – amid warning they could slide even further.
A close examination of the article underneath this startling headline discovered there was no evidence in the story to justify the headline. Quite simply, the headline was a blatant fabrication – which, sadly, is all too common in today’s news media.
The article revealed that Sydney’s median price was 0.8% lower than three months earlier but 3.3% higher than a year earlier, while Melbourne was down 1% over three months. Nothing in those figures goes even close to “prices plunging”.
In the other major cities prices were still rising and indeed were still growing at boom time rates.
House prices were also up in the Combined Regions in the latest month, the latest quarter and the past year– and unit prices were also up nationally, both in the cities and the regions.
So, there was very little sign of even minor decline in prices anywhere and certainly no evidence at all of price plunging.
So this was yet another instance of a headline which was an outright and blatant lie.
And who wrote this rubbish? well, it was the champion of negative media about residential real estate, the endlessly sad Shane Wright who has devoted his career to writing nonsense about property markets.
But wait, there’s more. Not only is the fictional national price boom over, but apparently the rental boom is over as well!
There have been strident headlines and soundbites inferring that rents are no longer rising.
As is so often the case with these big sweeping media statements, the claim was based on a single month’s figures from one source. Nationally, rents rose only 0.2% in November, according to CoreLogic, therefore the boom is over in the simplistic minds of attention-seeking analysts and journalists.
And, yes, once again, the source of this myopic and shallow analysis is CoreLogic, a business which publishes lots of major real estate data but is quite dreadful at analysing what it all means.
So CoreLogic’s head of research Tim Lawless said:
“At 5.3% annual growth, rents are still rising at more than twice the pre-pandemic decade average of 2.0%, but given the weak monthly change the annual trend is set to slow further from here.
“It will be interesting to see if the rate of rental growth rebounds through the seasonally strong first quarter of the year in 2025, but beyond any seasonality, it looks increasingly like the rental boom is over”.
But other sources tell a different story. SQM Research records a monthly rise of a tick under 1% as the national average for residential rents, with Adelaide up 1.1%, Perth rising 1.9% and Canberra up 1.5%.
The national vacancy rate remains a fraction above 1%, essentially unchanged from three years ago, so can anyone justify a claim that the rental shortage crisis and rising rents is all done and dusted? Hardly.
Another startling set of headlines resulted from the latest Regional Market Update from CoreLogic which declared that the highest capital growth was occurring in Queensland and WA mining towns.
I was truly perplexed because I know there has been little price growth recently in mining towns like Karratha, Port Hedland and Newman in WA and Moranbah in Queensland.
However, the headlines resulted from CoreLogic boffins – yes, it’s CoreLogic again - re-defining major regional cities as mining towns.
Apparently Townsville, which has one of the most diverse economies in regional Australia, with only minor influence from the resources sector, is now a mining town.
So is the key Central Queensland of Mackay, apparently, despite being 2-3 hours’ drive from the nearest coal mine.
In WA, the key regional city of Geraldton is also, apparently, a mining town, according to Core illogic, although the nearest iron ore mine is an hour’s drive away.
All of this, and a whole lot more, reinforces our view that there is more misinformation than actual information in mainstream media.
And that any real estate consumer who bases a decision on the content of media reports is at risk of making a very bad decision.
