The Australian housing market revival has continued into 2013 with “solid indications of rising buyer activity and increased confidence from sellers” says Australian Property Monitors (APM) in its latest market report.
“The revival of Australia’s housing markets in 2012 has been confirmed as leading indicators such as auction clearance rates point to a market heating up.
“Historically low interest rates are the fuel to this emerging fire which is no real surprise given the typical impact of low mortgage rates on buyer activity in previous housing growth cycles," says APM.
It adds that housing markets are “off and running in 2013, building on the buyer momentum generated through 2012 but now translating to more generalised and comprehensive market outcomes”.
Fairfax-owned APM has house prices up 1.5% over the three months to January to a median of $544,000 with units up 0.3% to a median of $413,000.
The Gold Coast has shown the greatest gain over this period with house prices up 2.2% though the key Gold Coast unit market has recorded no gains.
All othe capital city markets have recorded gains of 1% or more in their median house prices over the January quarter, with the unit market more patchy.
APM is confident of a return of first-home buyers in 2013, which along with investors were "significant contributors to the housing market revival of 2012".
“First-home buyer activity was largely generated by changes to various state government incentive schemes that acted to draw forward demand from this group.
“After a subdued start to the year, first home buyer activity is set to rise sooner rather than later, driven by low interest rates, a solid economy, and rising house prices and rents.
“Investor activity is also set to intensify in 2013, driven similarly by low mortgage and deposit rates, prospects of improved capital gains, and solid yields from most local markets," says APM.
APM also notes that the sharemarket is also a solid leading indicator of housing market activity, particularly in relation to prestige properties.
“With the All Ordinaries now holding above 5,000 for the first time in three years, a rising bull market will activate prestige markets that are finally showing early signs of emerging from a sustained period in the doldrums.
APM also notes an improved global economic outlook with the US housing market finally showing signs of life.