The Property Trio (formerly The Property Planner, Buyer and Professor)

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: Market update 1. Cash rate rises by 50 basis points, but the sky's not falling in The RBA raises the cash rate by 50 basis points to 0.85%, with an expectation that rates will increase by the same amount next month as well. However, this is no reason to panic. The cash rate was at 1.50% pre-covid, so there is still some room to move and the reality is that the cash rate was never meant to be as low as 0.10%. This was an extraordinary measure put in place to tackle the challenges that global pandemic brought. 2. The wage price spiral The trio discuss the possibility of a wage price spiral caused by high inflation. If wages increase in line with inflation (5-6%), it embeds inflation further and that's when the probability of job losses is increased, which is a worse outcome than slightly lower wage growth. This is an increased risk if minimum wages are increased, as employment awards and enterprise agreements are raised by the same percentage, effecting a vast amount of wage growth. 3. The current state of the economy Whilst many home owners may not like the prospect of increasing interest rates, however the economy is a strong position, which is why the cash rate has been increased. As stated by the RBA, the Australian economy is resilient, growing by 0.8 per cent in the March quarter and 3.3 per cent over the year. Australians are well ahead on their mortgage repayments, with a median of 21 months of repayments in savings, even with a 2% rise in mortgage rates, this would only reduce to 19 months. There is an upswing in business investment underway and a large pipeline of construction work to be completed. The terms of trade are at record highs, the lowest unemployment rate in almost 50 years and jab vacancies at high levels. 4. The latest home value index results The trio discuss the index results for May, which show Sydney and Melbourne on the decline, while Canberra went slightly backwards but a negligible amount. Astoundingly, Adelaide is still going strong with 1.8% increase over May. The market is well and truly slowing down for the other capitals and regions alike. As they say, all good things must come to an end, as we enter a period of 6 to 18 months of excellent buying opportunity. 5. Rentals and vacancies Rental markets continue to remain tight, with each capital city under 2% for vacancy rates. Those are expected to get tighter with the flow of new migrants to Australia. Builders will not be able to pick up the slack and increase supply to meet the demand, with fixed priced contracts in precarious positions as a few major builders go under. Now that prices are flattening, yields are growing even faster, with Melbourne now leading the charge for units, adding on 10% in the last year for asking prices. 6. Listing numbers on the decline Total listings are down for every capital city and in a change of gear, old listings (listings on the market for longer than 180 days) are increasing. This means that the up-take of the less desirable stock has slowed down for much of the nation, only in Brisbane are buyers still snatching up whatever they can. The upshot is that buyers are taking their time, FOMO has lessened and there is not as much pressure from other competing buyers. 7. Consumer sentiment continues to dive The house price expectations index, which typically lags behind market movements, is catching up with the market and starting to reduce. Th...

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: Market update 1. First signs appear of inflation slowing down in the US Dave shares some promising news from the US about the rate of inflation starting to cool, with the core index rising by only 0.3%. Share markets have picked up the pace with this positive development. Australia is well behind the US inflation cycle, but is also lower on the inflation scale. Watch this space. 2. Caution for landlords thinking about rent increases Vacancies have been tightening across Australia and rents have been rapidly increasing, with many cities under stress with tenants scrambling to find a home. Cate shares a hot tip for the nation's rental providers looking to increase their rent. This is an important balancing act for our landlord listeners, as asking rents should be in line with the market rate, but hitting tenants with a substantial increase can cause problems as well. This point is particularly for those who have good tenants and have kept rents below market, but applying fair and consistent increases that don't shock our tenants is really important. Case study #3: Do we purchase a holiday home or an investment property? 1. The conundrum This case study follows the journey of Tom and Linda, who wanted assistance with working through the various pros and cons on how to best achieve their long-term financial and lifestyle goals. In terms of their next purchase, they weren't sure whether they should start building their investment portfolio or purchase a holiday home as they are satisfied that they are living in their long-term home. 2. Introducing Tom and Linda Dave shares Tom and Linda's key circumstances and of course, their lifestyle and property goals which are driving their decision. Tom and Linda are a couple in their late 30's with two children under 4 years old, living in one of Australia's major capital cities. Their initial plan was to purchase an investment property now, another investment in two years and a holiday home two years after that - very ambitious! However, the desire for a holiday home now to create life-long memories with their two children were holding them back and delaying their decision. 3. Modelling the scenarios Two scenarios were modelled for Tom and Linda, one to purchase their holiday house now at their preferred price-point of $800,000 and the second for one or two investment purchases for a total of $1.8 million. Yes, you read that right, $1.8 million. Can it be done? The trio discuss the pros and cons of each scenario. 4. So, what did they choose to do (and what was the compromise)? Tune in to find out which scenario Tom and Linda went for, were they successful and what was the compromise? 5. Critical considerations for wistful holiday home purchasers The trio discuss the pull and longing for many Australian's to have a holiday home all of their own. But before taking the plunge, it's imperative to crunch the numbers and understand the compromises to your bottom line, so you can make the decision with absolute clarity. For further insights, take a listen to episode #81 "Holiday houses - delirium or dream?" Visit the show notes - https://propertyplanning.com.au/property-planning-case-study-3-should-our-next-purchase-be-the-holiday-home-or-an-investment-and-how-do-the-financial-outcomes-marry-up-with-our-short-and-long-term-goals/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: Market update Market update 1. Quality properties garner competition despite market cycles Cate shares her experience of bidding on election weekend, which as expected, was quieter than usual as prospective buyers took to the polls and enjoyed a democracy sausage. However, one property in particular which ticked many boxes saw a very competitive auction, which reinforces the basic principle that quality properties will garner interest and competition whether the market is rising or experiencing a lull. 2. The results of US cash rate increases Dave shares some surprising data from the US which has gone through 14 cycles of cash rate increases and 11 recessions. Stay tuned for next week's episode, for a comparison with Australia's history of rate increases and how they have impacted the economy. 3. Government shared equity scheme Pete encourages our listeners, whether first time buyers or parents with adult kids, to check out the government's shared equity scheme which is set to be introduced on the 1st of July this year. There will be income caps and property value limits, but for anyone looking to get a foot in the property door, this could be a good initiative. Plotting Australian property market movements 1. A look at Australia's price spikes Since the 1950's, Australia has seen 3 periods of stellar growth. The most mind-boggling being 1950, where prices grew 111%! What were the drivers of growth and how have these forces changed over time? 2. Disrupting the property market Fast-forward to today's drivers of capital growth, it seems that proximity to the city will continue to be a key factor for desirability, competition and property price growth. With more households sustained by double incomes, convenience and being close to amenities has been more important than ever. The trio discuss what could shake up the status quo. 3. Diving into Australia's recessions The trio discuss the recessions from 1970's to now, what caused them, what were interest rates doing at this time and how these features compare with our nation's situation today. 4. How financial deregulation has impacted the property market The trio look back to 1980's which saw an upheaval in banking regulation and how this impacted the economy and property market. After all, Australia held the mantel for the country with the longest period of time without a recession. 5. How has population growth impacted capital city prices? Does population growth have a direct correlation to capital growth? The trio dive into the data to answer this question. 6. How have capital city prices on the ladder changed over time and which cities displayed more volatility than others? The trio discuss the movements of capital cities from 1970 and how each have performed. Interestingly, Perth has been near the top of the ladder a few times, highlighting the power of employment, natural resources and availability of high-paying jobs. Check out our show notes for a great infographic that shows the growth of capital cities in inflation adjusted dollars. 7. Why property is a great asset class to invest in The trio discuss the history of property prices in relation to inflation and why investing in property is a solid move and a great hedge agains...

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: Market update 1. Properties still hotly contested Cate shares her weekend auction experience at a trendy inner-northern suburb in Melbourne. Despite the looming election, competition was strong and felt like we were back in the throws of September 2021 when the property market was going gangbusters. It goes to show that quality properties are still attracting competition. 2. Rents on the rise Capital cities have been posting mammoth increases in rents, with the trend now that rental growth is outpacing the rate of capital growth. High capital growth performing assets may have lower yields, but it's likely that rental growth will outperform in the long-run. 3. How do rising interest rates affect the property market? With many prospective investors nervous about investing with interest rate rises on the horizon, Cate shares data on historical property downturns and increases and how this has correlated with interest rate rises and falls. Check out our show notes for the link to Cate's blog. 4. Perth recovery For the first time in 8 years, the median value of Perth has finally reached a new record price. It's been a long recovery with many investors and owner occupiers wallowing in negative equity, but following the relaxing of covid restrictions, Perth has recovered from previous downturns. Show notes - Listener questions 1. A question from our listener - Should I invest in property now or wait until after we have kids? My partner and I are in our late 20s, work full-time and plan on starting a family in the next 3-4 years. We bought our first home in 2019 (Woodcroft Adelaide) which we plan on staying in long term. Since then, with extra repayments and the market we have built up equity (~200k useable). As our incomes will be changing with time off for kids, what advice would you have when weighing up the pros and cons of investing now compared with waiting until our incomes are more more steady (ie kids starting school) and we have paid off more of our mortgage. 2. Crunching the numbers The key question to answer is whether our listener will be financially secure if they purchase an investment property now and then go on to start a family, which comes with reduced incomes and additional living expenses. The trio crunch the numbers and discuss what price point would be viable. 3. Buffers and risk tolerance A fundamental point to consider when planning for an investment is risk management and whether the available funds buffer will allow our listeners to have a good night's sleep. Risk tolerance is key here, ask yourself, "would I be comfortable if my net monthly cash flow was very limited, neutral or even going backwards?". If cash flow will be negative during the period of having children, then maintaining a buffer large enough to support a growing family will be a critical consideration. 4. How does the family home fit into your investment decision? Our listener has done well for himself to purchase the long-term family home, which is large enough for a family with 2 children. Staying in the current home makes it much easier to build an investment portfolio. However, those who are considering embarking on the journey of having children and also purchasing an investment property must consider how their needs from a family home may change in the future once the kids come into the picture. If upgrading is on t...

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: 1. Adelaide top of the pops For the first time in a long time Adelaide is the highest performing capital city for the quarter, topping the charts with 5.7% growth. Adelaide just surpasses Brisbane's 5.6% recorded quarterly growth. 2. Capital city market cycles diverge Due to governemnt stimulus during covid lockdowns, all capital cities were simultaneously growing in value. In a return to normality, capital city property growth trajectories have diverged, with cities now at different phases of the property cycle. Sydney is in slightly negative territory, Melbourne plateauing and Hobart now on a downward trend, the worst performing over the month of April. On the other end of the scale, Adelaide and Brisbane are still flying, while Perth has rebounded and is starting to rise. 3. Combined regions continue delivering strong growth Regional areas have continued the run of solid growth, returning (a combined regions measure) of 1.4% value growth over April while capital cities combined only raised by 0.3%. Over the last 12 months, the regions have returned a whopping 28.5% total return. The trio discuss the peak rate of growth, working from home, migration trends and the insights that can be gleaned. But is this a permanent attraction by home buyers towards the regions? 4. Rents and vacancy rates likely to entice investors back into the market Nationally, vacancy rates have hit 1%, which represents a very tight rental market considering 2% is the norm. Even the poorest performing cities, Sydney and Melbourne, are below 2%, with all other capitals posting below 1%. This is good news for investors, because rental yields, (which have been at an all-time low for a while), are now expected to move back to historical norms. 5. Melbourne and Sydney unit market recovering A year ago, the Sydney and Melbourne unit market hit rock bottom. In a stellar recovery, unit rents are up by 8% for Melbourne and 9% for Sydney over the last year. This is likely to lead to value growth for units, as investors catch wind of rising rentals, tight vacancy rates and higher rental yields, and jump on the bandwagon. 6. Interest rates rise but the sky is not falling A deterrent for budding investors is the strong likelihood of rising interest rates over the next year. However, market conditions are still incredibly positive. Property values are up, rents are up and interest rates are still historically very low, even if they do rise by 1%. Don't forget, lenders factor in rising interest rates and changing market conditions and they add in a buffer to their affordability assessment accordingly. 7. Listings drop, is the election to blame? Nationally, listings volumes have dropped over the last 3 months. People do get nervous with a pending election, even though there are no big ticket property items on the agenda this time around. The trio will be watching this space closely to see what happens with listings post the election and how this imbalance will affect property values. 8. Key insights from lending indicators The level of investors entering the market has started to plateau, while first home buyers are on a slight uptick. Comparing with historical figures, the level of investors and first-time buyers are in a balanced position. The trio discuss the private rental market and the key role it plays in housing those who are not able or not ready t...

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: Market update 1. RBA lifts the cash rate Breaking news! The cash rate was lifted last week by 0.25%, taking the cash rate to 0.35%. This is a change of tune for the RBA governor, who was predicting that rates wouldn't rise until 2024. The move came as a result of rising inflation pressures, but the inflation Genie might not be that easy to put back in the bottle. Stay tuned to next week's market update episode for more on inflation. 2. Riding the market cycle wave Property prices are certainly slowing and may well start to decline, but this is no cause for panic. Pete shares his research on the property downturns over the last 25 years and in the end, you need to be prepared to take the good with the bad. If you're in it for the long-term, just sit tight and ride out the wave. 3. Late bids and auction rules Cate shares a recent auction experience that had hearts stopping and blood pressure rising. It was bad luck for a bidder that jumped in too late, because when the hammer falls, the game is over. Top 10 tips for first time buyers and investors 1. Educate yourself A sure fire way to get started on the property journey is to take the time to educate yourself. The trio take our listeners through the wealth of resources that are available to build a solid foundation of property knowledge. 2. Mix with like-minded people Or should we say, avoid naysayers? Negative Nancy's can quickly unravel a smart strategy and plant seeds of doubt, causing inaction, which can often be worse than taking half-good action. Mixing with like-minded people provides an environment where ideas are exchanged and much needed support is provided for what can be a stressful decision. 3. Set your goals Dave shares with our listeners 10 tips on how to create goals and stick to them. For further insights, take a listen to episode 82, "Goal Setting fundamentals for property success". 4. Select where and what to buy The trio discuss the critical elements of selecting a location and property to purchase. But don't forget to look ahead and think how the first property could impact future long-term plans. 5. Visit your areas and do your research The trio share the best data sources for doing research from the comfort of a laptop at home or in the office. However, that does not negate the need to get out and about and take a stroll through the area you're interested in purchasing in, particularly if you haven't lived there before. Yes, property investors, this applies to you too! 6. Find out how much you can borrow & if there is any assistance A critical step here is sorting out a budget, taking into account existing cash flow, desired cash flow and available funds post-purchase. Dave shares with our listeners why the lowest interest rate is in fact not the key to success. Ask yourself - is the property or the rate more important? 7. Save money for a deposit, consider shared equity, joint ownership Money management! It may seem easy to a first home buyer as often they don't have children, and/or might not be partnered yet with mortgages and credit cards to juggle. But the sooner you can set up an effective money management system, (and get your partner on the same page) the better! The trio discuss the basics of shared equity schemes and join...

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: Market update 1. Thank you for the review! Cate shares a lovely review that we received in the apple podcast app. Not everyone is able to access expert advice, which is why we love putting these episodes together for our listeners. But more so, we really feel a spring in our step when we know we've helped a listener, so please keep them coming. They mean a lot to all three of us. 2. Clean energy to bolster national defence An interesting article in the Australian Financial Review has shed light on Australia's reserves, with only 18 days of petrol supplies and 22 days of diesel supplies in stock. Part of the reason why the Ukrainian's have been so successful in resisting Russian attacks, is the need for Russians to retreat to re-stock. The low reserves for Australia highlights a weakness in defence and puts the nation at risk is different ways. The good news is that this could be the push and driving force needed for Australia to become self-sufficient and transition towards green energy. We're hoping! 3. A round of applause for Adelaide is due Recent reports from CoreLogic show that Brisbane and Adelaide continue to shine as Australia's best performing capital cities. It's not often that Pete gets to brag about Adelaide, so we'll let him have this one. Property Planning Case Study 1. A mixed bag - investment, holiday house and future long-term home. Can we have it all? This case study follows the journey of James and Amanda who had a number of boxes to tick for their next property. They weren't sure if they should purchase a straight-forward investment property or if they could achieve an investment property purchase in a beachside location which could double as a holiday house and maybe even eventually become their long-term future home when it comes time to downsize. Another ingredient to add to the pot was that they didn't want to compromise their current lifestyle and for extra spice, ideally this property would work towards achieving their income goals for retirement. 2. Introducing James and Amanda - financial overview and goals Dave shares James and Amanda's key circumstances and of course, their lifestyle and property goals which are driving their decision. With two teenagers in private school and very little surplus cash flow, the key conundrum to unravel was how to complete the next purchase without compromising their current lifestyle and saving enough cash to have family adventures. Their initial preferred price point was initially determined to sit around $1.2M, however James and Amanda realised that they would be hard-pressed to find a property they would enjoy as a holiday house and a long-term future home. 3. Modelling the scenarios Two scenarios were modelled for James and Amanda, one at their preferred purchase price-point of $1.2M and the second for their revised, (and more realistic) price point of $1.4M. Dave explains how, (with some clever mortgage strategy and borrowing capacity finesse), the $1.4M price point was achievable, despite their tight cash flow. 4. So, what did they choose to do, (and what was the compromise)? Tune in to find out which scenario James and Amanda went for, were they successful and what was the compromise? 5. How will James and Amanda reach their retirement income goal? James and Amanda had a retirement income goal of $60,000 p/a through property rents. Wit...

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI

https://propertyplanning.com.au/propertyplannerbuyerprofessor/

In this week's episode Dave, Cate and Pete take you through: Market update

1. Victorian's snubbed by the Federal Government Budget Looking at the Federal Budget infrastructure spend, it appears that Victoria has been overlooked to some degree. The budget set aside $208.4 million in new money for Victorian infrastructure which amounts to 5.9% of the Federal Government spending on infrastructure projects, while the percentage of the Australian population living in Victoria is 25.8%. Interestingly, money has been earmarked for the East-West link project that was booted by the Andrews government.

2. A closer look at capital cities that have pulled back on capital growth Melbourne and Sydney experienced slightly negative capital growth in the month of March. This is expected to continue into April, with two long weekends and a disproportionate increase in listings. Segmenting the market further, it's evident that the higher end properties in the inner ring and inner east of both cities has taken the hardest hit of late. This is consistent with previous market trends, where the top quartile is often the first to move in a changing market.

3. Foreign investment in residential property drops from $10 billion to $6 billion Critical information left out of this headline is that foreign investment in commercial property has doubled from $39 billion to $82 billion, which in part explains why yields for commercial property have lowered. The Australian property market has been seen by foreign investors as a safe haven and yields may very well drop further if commercial property continues to attract interest from overseas buyers. In light of looming interest rate hikes, diminishing yields could be a major concern. The trio discuss the factors and measures which could dampen foreign investment. Migration

4. How has COVID affected population growth? For the last 20 years the Australian population has grown consistently at 1-2.2% year on year. However since the beginning of COVID, this figure has plummeted close to 0% due to international border closures. There is more to the data than migrants and new arrivals, however. Overall population figures also include returning expats, births and deaths. The trio discuss how this has impacted employment, universities and capital city markets.

5. Melbourne and Sydney the biggest losers in flight to the regions There are no surprises that the nations' largest capitals of Sydney and Melbourne were hit the hardest in the great tree and sea change. There are many and varying reasons aside from COVID lockdowns and working from home to explain why this would be the case. A major factor is runaway house prices, which naturally causes migration and investment when housing affordability bites and regional opportunity presents itself as a more cost effective way of life for some households.

6. The outlook for Melbourne Melbourne sustained the biggest population losses in 2021, where a total of 32,000 people left for the regions and interstate, while Sydney lost almost 20,000. Prior to this, Melbourne was on the road to overtaking Sydney to be the most populated city in Australia. Dave shares insights from the Centre of Population on the trajectory for Melbourne's population recovery.

7. Job vacancies jump in regional Australia Cate shares the top 5 regions with the biggest increases in job vacancies over the 12 months from February 2022. Job vacancies are putting pressure on businesses in location...

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: Market update 1. Could now be the time to buy? Today's market is still a seller's market, although not as crazy as last year. In our two capital cities, many properties are passing in but selling immediately afterwards, and auction clearances rates have lowered but still in the 70's. With global unrest in Ukraine, the federal election looming and chatter of interest rate rises, this might just be the window that you've been waiting for if you're looking to purchase. 2. Turning the tables on fixed rates The Covid induced measures targeting the 3 year bond yield meant that for much of 2020 and the first half of 2021, fixed rates were the lowest we've ever seen and even lower than variable rates. However, the last 10 or so months have seen fixed rates rise and the lending market switched back to the normal status quo of variable rates being lower than 3 year fixed rates. 3. Check out the new CoreLogic website CoreLogic have made some improvements to their site, which is a huge positive as it gives the average punter an excellent idea of what's happening in the market. Vendor advocacy and borderless buyer's agents 1. Call out to our listeners for questions In this week's episode, the trio tackle questions from our listeners on vendor advocates and borderless buyer's agents. Got a burning question? Submit your question to the trio here: https://zfrmz.com/uLtjhyBskV96PY6eJfaI 2.Should I use a vendor's advocate? The question from our listener: I am interested to know about vendor advocacy. We are selling a property and have been approached by a known buyer's advocate in our area who has offered to act as our vendor advocate. This isn't the first time we have sold, it's our fourth time and our most important. We haven't been overly happy with our agents in the past and could see the value this person could bring. The thing I can't reconcile is why an agent would do more for us at the request of our advocate when they are getting less commission (advocate getting their share). We are open to a new experience and after two discussions with the advocate we can see the knowledge base is high. We just don't know what to be careful of and if we end up paying a higher commission will it be worth it? 3. What is a vendors advocate and can they add value? The trio unpack the difference between a vendor's advocate and a selling agent, plus the benefits and risks of using a vendor's advocate. Cate shares her expertise on working alongside vendors advocates and Dave shares his thoughts based on when his company had buyer's agents and vendor advocates in-house. When done well, vendor advocacy can certainly add value, but there are critical considerations in vendor advocate selection to be aware of. 4.When is engaging a vendor's advocate the right move? The trio discuss the circumstances that lend well to using a vendor advocate and Cate shares some critical questions that our listeners should ask vendor advocates when choosing one to work with, and in particular, the experience and the credentials they should have. 5. Borderless vs local buyers agents - the pros and cons The question(s) from ou...

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: 1. SA council takes matters into its own hands Pete shares the measures that the Karoonda East Murray Council in SA are trialing to grow their population. Kudos to them! Rather than waiting for the federal or state governments to come to the party, they are implementing some great initiatives themselves. 2. How long does it take each capital city to double in value? Pete shares with our listeners his research for each capital city, starting from March 2022 and working backwards, to distill how long it has taken for property values to double in each capital city. The winner may be a surprise, however the trio warn that some of the performances can be unpredictable. Trying to pick the next hot location is fraught with danger and our listeners are better off sticking to the tried and true principles of selecting quality investments. 3. Sydney and Melbourne flatlining while Brisbane and Adelaide continue to shine The trio take our listeners through the highlights in the March home value index results and the reasons behind the numbers. Plus, not all the numbers can be relied upon. Hobart is such a small market that there may be some anomalies skewing the results. 4. Rents turning the tide For the first time in a long time, national rents are outgrowing housing values. Which also means that yields are increasing, particularly in Melbourne and Sydney which have each had a small degree of negative capital growth. Interestingly, it appears that there is a flock back towards units and inner city living. Sydney now records the strongest lift in unit rents with Melbourne not far behind. How the opening up of borders will impact this further is a story that is still unfolding. Vacancies have also dropped to a fresh 16-year low, putting immense pressure on rental markets. 5. How do current listings compare with the 5 year average? Nationally, "total" listings are 30% below the 5 year average. The trio have been saying for months now that there is a deep correlation between the level of listings and capital growth. An example is Brisbane and Adelaide, both of which have experienced the strongest capital growth outcomes in March and also have total listing numbers that remain 40% below the 5 year average. The story is similar for regions, as there are 22% less sales in combined regional areas for this current year so far. 6. Consumer sentiment takes a dive The house price expectations index has fallen by 10.8% to 139 points. This index tends to lag behind actual market movements and the writing has been on the wall in 2022 that growth in the housing market is well and truly slowing down, (for most states). Interestingly, the time to buy a dwelling index has also dropped to 78.3 points, after hovering in the low 80's to high 90's since July 2021. This index is now at its lowest level since February 2008, during the GFC and well below levels seen in the 2017-18 housing market decline. This is not a good harbinger for what's to come, as this index tends to be a forward indicator. The trio discuss the reasons behind the drop in sentiment. 7. Turning the tables on fixed rates With fixed rates on the rise due to increasing bond yields and swap rates, lenders have started to compete on variable rates. Now that the tide is turning, many variable rates are lower than the fixed rate offering. Pre-covid, this status quo was the norm and it was the RBA measures which drove fixed rates to the lowest they'd eve...