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Residential and commercial property market update...
RESIDENTIAL
Units outshine houses in capitals
Units in Australia’s capital cities are showing better value than detached houses, new data reveal.
THE CAPITAL cities have many more affordable housing options in the unit market than in the detached dwelling market, according to RP Data
In the capital cities combined, 18.1 per cent of suburbs have a median unit price under $300,000, while a majority have a median unit price between $300,000 and $500,000, with almost 60 per cent of all suburbs sitting within this range.
Many cities have plenty of stock from which to choose, although the story in Canberra and Darwin is quite different.
Darwin, Australia’s best yielding rental city, has no suburbs with a median unit price under $300,000, while just one per cent of Canberra’s suburbs have a median unit price under $300,000.
RP Data research analyst Cameron Kusher said that in every other capital at least 10 per cent of suburbs have a median unit price below $300,000.
“Affordable price points close to a city centre is one of the key reasons why demand for inner city apartment living is on the increase,” he said.
Suburbs with median prices between $300,000 and $500,000 are most abundant between 10km and 20km from the city centre, accounting for 64.9 per cent of all suburbs.
Suburbs with a median unit price under $500,000 form 78.3 per cent of all suburbs within 10km and 20km of each capital city centre.
This value decreases the further you go from the CBD and at around 30km from the city centre, Mr Kusher found virtually all suburbs have a median unit price of under $500,000.
“This reflects a narrowing of the pricing differential between units and houses as you move further away from the city centre,” Mr Kusher says. “However, with that result, the supply of units typically decreases.”
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COMMERCIAL
Commercial property sales on the rise
Commercial sales are on the up, according to the latest first quarter data from CBRE.
COMMERCIAL PROPERTY sales started the year stronger than expected, with preliminary CBRE data showing $1.4 billion in transactions above $20 million in the first quarter.
CBRE’s executive director, global research and consulting, Kevin Stanley said concerns in the first quarter centred on financial uncertainty in the Eurozone which slowed investment decision making.
The volume of the first quarter transactions, however, was still 18 per cent above the post GFC average for the first quarter.
CBRE regional director, institutional investment properties, Rob Sewell said the first quarter sales had been impacted by an earlier than usual Easter break, with many vendors delaying marketing their assets.
On the buyer front, Mr Sewell said many institutions were showing a preference for assets with higher cash yields rather than lower yielding growth assets given a continuing wariness regarding occupier demand.
Trading in the quarter was dominated by a few large deals, with the sale of a 50 per cent share of the Brisbane Myer Centre for $366 million by far the largest.
“This is a sign investors are still keen to invest significantly in a sector which has had its challenges with low consumer spending in some merchandise sectors and online retailing growing in popularity,” Mr Stanley said.
Foreign investors continued to make their presence felt in the quarter, purchasing 43 per cent by volume of all assets sold. This follows a year when foreign investors purchased a record 37 per cent share of all commercial properties sold above $20 million.
