L: Suite 8, Level 12, 101 Bathurst St, Sydney

P: 02 8001 6640
E: [email protected]
W: http://37propertygroup.com.au

Half Yearly Property Market Research Report

Australia

ABS Price Index of Established Houses

300.0

250.0

Sydney
200.0
Melbourne
Brisbane
150.0 Adelaide
Perth
100.0 Hobart
Darwin
50.0 Canberra
8 Capital Cities
0.0
Sep-2007
Sep-2002

Sep-2003

Sep-2004

Sep-2005

Sep-2006

Sep-2008

Sep-2009

Sep-2010

Sep-2011

Sep-2012
Mar-2010
Mar-2002

Mar-2003

Mar-2004

Mar-2005

Mar-2006

Mar-2007

Mar-2008

Mar-2009

Mar-2011

Mar-2012

Mar-2013
The ABS (Australian Bureau of Statistics) Price Index of Established Houses or commonly referred to as
the ‘HPI’ is compiled by recording transactions in detached residential dwellings on their own block of
land regardless of age (including new houses sold as a house/land package as well as second-hand
houses). Price changes refer to changes in the total price of dwelling and land, which have been
referenced (started measuring) from 2003/04.

 Darwin has outperformed all other capital cities with growth of 2.5 times since the start of the
index.
 Perth is second to Darwin with growth of 2 times since the reference year.
 Sydney has been fairly stagnant according to the index, possibly due to higher prices compared
to many other capital cities.
 The 8 Capital City average have almost doubled Sydney’s growth since the reference period.

“A brilliant
mixture of youth
and experience”.
 L: Suite 8, Level 12, 101 Bathurst St, Sydney
P: 02 8001 6640
E: [email protected]
W: http://37propertygroup.com.au

ABS / RP Data Median Price of Established House Transfers

700

600

Sydney
500
Melbourne
($'000)

Brisbane
400
Adelaide
Perth
300
Hobart

200 Darwin
Canberra

100
Sep-2002

Sep-2003

Sep-2004

Sep-2005

Sep-2006

Sep-2007

Sep-2008

Sep-2009

Sep-2010

Sep-2011

Sep-2012
Mar-2003
Mar-2002

Mar-2004

Mar-2005

Mar-2006

Mar-2007

Mar-2008

Mar-2009

Mar-2010

Mar-2011

Mar-2012

Mar-2013
Median price data has been compiled from ABS and RP Data median price releases. RP Data has been
included as the ABS data hasn’t released median prices since September 2012. This method has been
used as a way to portray what has happened until the current period in May 2013.

As can be seen a differing outcome is portrayed between the index and actual median price changes in
the 8 Capital Cities.

 Sydney is clearly the most expensive capital city with a median price well over $600,000.
o Over the last 10 years Sydney has performed well with an almost ‘doubling effect’ with
growth from the high $300,000 to mid $600,000.
 Canberra and Melbourne have grown similarly over the last 10 years with growth over $20,000
per year on an average priced house.
 Darwin has performed very well shooting up from around the $200,000 mark to mid $550,000 in
April 2013.
o This is growth over $35,000 per annum.

“A brilliant
mixture of youth
and experience”.
 L: Suite 8, Level 12, 101 Bathurst St, Sydney
P: 02 8001 6640
E: [email protected]
W: http://37propertygroup.com.au

RP Data Yearly All Dwelling Price Index

600
550 All Dwellings Sydney

500 All Dwellings Melbourne

450 All Dwellings Brisbane
($'000)

400
All Dwellings Adelaide
350
All Dwellings Perth
300
250 All Dwellings Hobart
200 All Dwellings Darwin

All Dwellings Canberra

The RP Data yearly price index is based on monthly press releases RP Data publishes for the public. All
Dwellings have been analysed which includes both houses and units to provide a market wide
understanding.

 The last year shows a general sideways trend in the market, which is common to occur over the
short term.
 As can be seen from The ‘Median House Price Transfers’ line graph, successful property
investment is for a period of roughly 10 years or more to fully experience the various cycles
property markets encounter. This will also give you enough time to decide when to enter or exit.

ABS Price Index of Project Homes

180
160 Sydney
140 Melbourne
120 Brisbane
100
Adelaide
80
60 Perth
40 Hobart
20
Darwin
Jun-2000
Jun-1986
Jun-1987
Jun-1988
Jun-1989
Jun-1990
Jun-1991
Jun-1992
Jun-1993
Jun-1994
Jun-1995
Jun-1996
Jun-1997
Jun-1998
Jun-1999

Jun-2001
Jun-2002
Jun-2003
Jun-2004
Jun-2005
Jun-2006
Jun-2007
Jun-2008
Jun-2009
Jun-2010
Jun-2011
Jun-2012

Canberra

Project homes are dwellings available for construction on an existing block of land. Price changes relate
only to the price of the dwelling (not the land). Therefore, the Consumer Price Index (CPI) would have a
similar correlation to this measurement, as that is the ‘price that good and services rise at’.

 As can be seen over the last 7 years, Darwin and Perth have experienced the highest price rises
for their project homes. This could be attributed to many reasons particularly the ‘mining’
boom’ which has created increased wages and subsequent higher prices for workers in the
construction industry to build new dwellings.

“A brilliant
mixture of youth
and experience”.
 L: Suite 8, Level 12, 101 Bathurst St, Sydney
P: 02 8001 6640
E: [email protected]
W: http://37propertygroup.com.au

RP Data Rental Yields - Houses

6.5

6 Houses Sydney

Houses Melbourne
5.5
Houses Brisbane

5 Houses Adelaide
(%)

Houses Perth
4.5
Houses Hobart
4 Houses Darwin

3.5 Houses Canberra

Houses 8 Capital Cities

3
Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13

RP Data rental yields measure the ratio of rent to purchase prices.

 The clear performer over the last year was the Darwin house market with rents surpassing 6% in
periods.
 Hobart has ‘comparatively’ high rents due to the affordability within the market.
 Sydney has been stable over the last year, having the highest prices in the country and managing
to maintain a strong rental return for purchasers.
 Melbourne lags behind largely due to an oversupply of new unit accommodation in the city
which has led to increased choice for renters and lower rents.

RP Data Rental Yields - Units

6.5
Units Sydney

6 Units Melbourne

Units Brisbane
5.5 Units Adelaide
(%)

Units Perth
5
Units Hobart

Units Darwin
4.5
Units Canberra

4 Units 8 Capital Cities

Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13

 Darwin has performed well for units over the last year with yields around 6%.
 Canberra and Brisbane have also performed well fuelled by competition for renters whilst new
projects are in the pipeline.
 Sydney continues its stability while Melbourne continues the trend of having the lowest yields
out of the 8 Capital Cities.

“A brilliant
mixture of youth
and experience”.
 L: Suite 8, Level 12, 101 Bathurst St, Sydney
P: 02 8001 6640
E: [email protected]
W: http://37propertygroup.com.au

SQM Vacancy Rates Average April 2012 - March 2013

3

2.5

2
(%)

1.5

0.5

0
Sydney

Melbourne

Perth

Hobart

Canberra
Adelaide

National
Brisbane

Darwin
Vacancy Rates Average Over The Last Year

Vacancy rates are a measure of how long properties remain in the property market for rent. SQM uses a
definition whereby if the property has been on the market (online listing portals) for more than 3 weeks
it will then be added to the stock and vacancy figures.

A market in extreme short supply of rental accommodation is considered below 1%. A market in short
supply is considered below 2%. A market in equilibrium is considered at 3%. Anything over 3% is
considered to be a market with oversupply.

 Vacancy rates for the 8 capital cities have ranged from as low as 0.6% in Darwin and Perth to as
high as 3% in Melbourne.
 Darwin and Perth fuelled by the mining boom have followed trends with some of the lowest
vacancy rates in the country.
 Canberra, Sydney, Brisbane and Adelaide maintain strength below 1.7% over the last year.
 Melbourne’s average vacancy rate figure over the last year of 2.7% shows a market with more
properties to rent than renters.

“A brilliant
mixture of youth
and experience”.
 L: Suite 8, Level 12, 101 Bathurst St, Sydney
P: 02 8001 6640
E: [email protected]
W: http://37propertygroup.com.au

Residex Previous 20 Year Capital Growth Percentages

Houses
10%

8%

6%

4%

2%

0%
Sydney Melbourne Brisbane Adelaide Perth Hobart (/) Darwin Canberra

Residex has measured capital growth in major Capital Cities around Australia since the early 1990’s. The
figure shows how Capital Cities have performed per annum over the last 20 years.

 Perth and Darwin have outperformed other major Capital Cities over the last 10 years, which
has particularly carried through over the last 20 years with annual growth rates exceeding 8%.
 Melbourne follows with growth rates in the low 7% range.
 Sydney follows with growth rates around 6.8% per annum, however has consistently been the
highest priced city.
 Brisbane has grown in the low 6% range, coupled with reasonably affordable median prices,
which leaves the city poised for the next 20 years.

Units
10%

8%

6%

4%

2%

0%
Sydney Melbourne Brisbane Adelaide Perth Hobart (/) Darwin Canberra

 Perth and Darwin continue to perform well in the unit market with annual growth over 7.5%.
 Melbourne with its cosmopolitan lifestyle follows with growth over 7% per year.
 Sydney, Adelaide and Canberra all have growth rates above 6% per year.
 Brisbane follows with annual growth rates at approximately 5.5%.

“A brilliant
mixture of youth
and experience”.
 L: Suite 8, Level 12, 101 Bathurst St, Sydney
P: 02 8001 6640
E: [email protected]
W: http://37propertygroup.com.au

Conclusion
The ‘Half Yearly Property Market Research Report’ for Australia conducted by 37 Property Group shows
some markets have performed exceptionally well over the last 10 and 20 years.

Many markets are showing signs of optimism, coupled with historically low interest rates making
Australia well poised for positivity in its property market over the coming years.

Many capital cities have excellent property projects which have high yields, low vacancy rates and are in
markets with huge potential over the coming 10 to 20 years.

37 PROPERTY GROUP Property Investment Model

Correct
Purchase Price

Macro & Micro Mixture Of

Economics Property Types

Infrastructure All Purchases

& Supply & Are
Demand Investments

Demographics Savings Plan

& Economics Implemented

Enhance The
Numbers Must
Existing
Stack Up
Portfolio
Location,
Location,
Location!

“A brilliant
mixture of youth
and experience”.