Demand for housing in the regions has picked up over the last quarter, the latest CoreLogic figures show... Antipodean housing booms could drive Kiwi to parity with Aussie...
Home values rise in the regions
The latest CoreLogic June Quarter Regional Report showed that demand for housing in the regions has picked up, with June quarter top performer Illawarra recording an annual house value increase of 14.3% and unit value increase of 13.9% – the largest value rise in the region’s history.
According to CoreLogic research analyst Cameron Kusher, the increase in values for both houses and units in Illawarra could be attributed to buyers who had been priced out of the Sydney market and are now diverting their investment dollars to this region.
“Our latest data points to an increase of value growth in regional markets, particularly those which are located adjacent to capital cities,” said Kusher. “As people are priced out of certain capital cities, buyers now appear to be looking to these adjacent regions.”
In Queensland, the Gold Coast and Sunshine Coast ended up as the strongest performing regions across the state, with both house and unit values increasing. On the other hand, sales activity in Victoria’s Geelong and Latrobe-Gippsland dropped by 2% over the year, though their median values and rental rates increased.
Mixed performance was seen in Western Australia’s Bunbury region, with house values rising by 3% and unit values falling by 6%. The only regional market to record a fall in values is Townsville, where houses dropped by 4.5% and units fell by 3.7%.
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Antipodean housing booms could drive Kiwi to parity with Aussie
(Bloomberg) -- Housing booms in New Zealand and Australia could be putting the neighbors' currencies on course to reach parity for the first time ever.
Both nations have seen house prices surge in recent years, but the underlying causes are fundamentally different, according to Deutsche Bank analysis.
Australia's boom is largely home-grown, whereas New Zealand's is being fueled by record immigration. That's affecting the countries' current accounts differently.
While Aussies are feeling richer due to house-price gains, prompting them to spend more on imports and boosting their current account deficit, New Zealand is sucking more offshore capital into its housing market, narrowing its current account gap. Currencies are sensitive to trends in the current account -- a country's balance with the rest of the world -- because they are a gauge of risk for investors.
``The nature of the real estate boom in Australia should have bearish currency implications because it leads to deterioration in the basic balance,'' Robin Winkler, a London-based strategist for Deutsche Bank, said in a research note. ``This is not the case in New Zealand and adds to our conviction that AUD/NZD should drop to parity.''
The latest CoreLogic June Quarter Regional Report showed that demand for housing in the regions has picked up, with June quarter top performer Illawarra recording an annual house value increase of 14.3% and unit value increase of 13.9% – the largest value rise in the region’s history.
According to CoreLogic research analyst Cameron Kusher, the increase in values for both houses and units in Illawarra could be attributed to buyers who had been priced out of the Sydney market and are now diverting their investment dollars to this region.
“Our latest data points to an increase of value growth in regional markets, particularly those which are located adjacent to capital cities,” said Kusher. “As people are priced out of certain capital cities, buyers now appear to be looking to these adjacent regions.”
In Queensland, the Gold Coast and Sunshine Coast ended up as the strongest performing regions across the state, with both house and unit values increasing. On the other hand, sales activity in Victoria’s Geelong and Latrobe-Gippsland dropped by 2% over the year, though their median values and rental rates increased.
Mixed performance was seen in Western Australia’s Bunbury region, with house values rising by 3% and unit values falling by 6%. The only regional market to record a fall in values is Townsville, where houses dropped by 4.5% and units fell by 3.7%.
Your Investment Property
Antipodean housing booms could drive Kiwi to parity with Aussie
(Bloomberg) -- Housing booms in New Zealand and Australia could be putting the neighbors' currencies on course to reach parity for the first time ever.
Both nations have seen house prices surge in recent years, but the underlying causes are fundamentally different, according to Deutsche Bank analysis.
Australia's boom is largely home-grown, whereas New Zealand's is being fueled by record immigration. That's affecting the countries' current accounts differently.
While Aussies are feeling richer due to house-price gains, prompting them to spend more on imports and boosting their current account deficit, New Zealand is sucking more offshore capital into its housing market, narrowing its current account gap. Currencies are sensitive to trends in the current account -- a country's balance with the rest of the world -- because they are a gauge of risk for investors.
``The nature of the real estate boom in Australia should have bearish currency implications because it leads to deterioration in the basic balance,'' Robin Winkler, a London-based strategist for Deutsche Bank, said in a research note. ``This is not the case in New Zealand and adds to our conviction that AUD/NZD should drop to parity.''
