The September quarter saw auction volumes increase across all capital cities. Auction clearance rates also increased, and this trend has continued into October. According to the RBA in its latest financial stability review, October was the month where most mortgage deferrals were due to expire. The coming months will shed light on how many vendors need to sell because of mortgage distress, and if this contributed to the increase in new listings during October. However this week’s interest rate announcement by the RBA may help bring relief to some borrowers as rates continue to fall to all time lows.

Property investor activity in the Australia housing market continues to fall. The latest ABS housing finance data has reported that investor lending has fallen to a new record low of 23.5%.

Core Logic says that continued decline in investor activity will be determined at the state level as various market and economic factors continue to impact the markets due to the pandemic.

The Federal Budget in October saw three significant housing-related measures highlighted that are expected to fuel new demand in the property market. The measures include an extension of the First Home Loan Deposit Scheme, additional low-cost financing for affordable housing and additional funding for the Indigenous Home Ownership program. A proposed capital gains tax exemption for granny flats from July 2021 was also announced.

Download and read the full Market Essentials – November 2020 Report.