Archive for the ‘BREAKING NEWS’ Category

House prices are rising rapidly in line with the strength of the South Australian economy

Somerton Park records a massive 35.64 per cent growth last year

Adelaide home price median rises to $382,000. Adelaide house prices have risen by more than 6 per cent in the past year and further strong growth is forecast for the year ahead.

Official Valuer-General figures, released, reveal the metropolitan median price rose 6.25 per cent to $382,500 in the December quarter 2009, compared to the same period in 2008.

Across the state the improvement was almost as dramatic, with a 5.77 per cent increase to $352,000. A year ago, the annual increases were only 1.4 per cent for the Adelaide metropolitan area and 4 per cent for the state as a whole.

The latest results impressed Real Estate Institute of SA, who said the figures were particularly promising given the Federal Government’s First Home Owners Boost was halved during the December quarter.

A statement released by REISA said; “this clearly demonstrates the faith people have in investing in bricks and mortar, and the reliability of the property market in Adelaide and South Australia,” he said.

“It gives us plenty of confidence that the property market will continue to grow now the boost has finished and we have reverted back to the existing $11,000 grants for established homes.

“People will still continue to enter the property market because they know it is a good investment, not because they get a one-off cash bonus.”

Somerton Park topped the list with massive growth of 35.64 per cent on last year.

The list was based on suburbs with 10 or more sales in the quarter.

It was followed by Broadview (28.42 per cent) and Willaston (22.37 per cent).

Western suburbs Clarence Gardens and Dover Gardens, and Burton in Adelaide’s north, also made the list, increasing by 22.21 per cent, 21.93 per cent and 21.57 per cent respectively.

Describing Somerton Park as “ideal for families”, Raine & Horne Glenelg Principal said Someton Park had benefited from the price rises of neighbouring Glenelg.

“I think people have realised that Somerton Park has been a bit of a hidden secret for a little while,” she said.

“A lot of people try to go to Glenelg but because Glenelg has gone up so much people have started to look further a field, which has resulted in price rises hitting the adjacent beachside suburbs.

“The beaches and the Somerton Life Saving Cluyb cafe on the beach, makes sunset there absolutely gorgeous, and because Somerton beach is not as well-known as Glenelg it’s less busy.”

Monika Bonet is the Principal of Raine & Horne Glenelg, your Glenelg Real Estate Agent and Glenelg Property Management expert.

Read the latest comments from Angus Raine CEO of Raine & Horne about the hike in interest rates…

The decision by the Reserve Bank of Australia (RBA) to increase the official cash rate by 25 basis points proved the major talking point for the property market in October.

The increase pushes the central bank’s cash rate to 3.25 per cent and the RBA governor Glenn Stevens said the increase was as a result of Australia’s continuing growth.

Raine & Horne CEO Angus Raine says the increase was the market’s worst kept secret, given the regular snippets of more favourable economic news coupled with the fact interest rates remain at historic low levels.

Nevertheless with the financial markets pricing in more rate rises by Christmas, the Raine & Horne chief is not convinced home owners can stomach more increases, especially as the Federal Government is also phasing out the First Home Owners Grant Boost (FHOB).

To this end, the Real Estate Institute of Australia says when a similar stimulus package was phased out in July 2002, the presence of first home buyers in the market fell by around 38% from 13,000 to 8,000 per month.

See what John Symonds of Aussie Homes has to say…

However Mr Angus Raine remains cautiously optimistic for the property market despite the challenges. “After an interest rate hike, people usually go back to the drawing board and work out what they can afford. There’s usually a time lag of a few weeks and then they’ll go out hunting again.”

REIA President David Airey is squarely in Mr Raine’s camp, and says caution is required regarding further decisions on rates.

“While the economic indicators suggest that Australia is on the way to recovering from the impact of the global financial crisis, these are early and tentative signs and we should be wary not to slow economic growth by increasing interest rates prematurely,” said Mr Airey.

PriceFinder Chief Operating Officer Kent Lardner, says, most home buyers need to be aware of inter­est rate movements, and urges them to allow for a servicing buffer for loan repayments of up to 3%.

 “The rise in interest rates is a positive sign of a strengthening economy. From PriceFinder’s perspective, our biggest concern over the last 12 months has been jobs losses and the effect that could have on property markets.”

 “The good news on the job front to-date will continue to help buyer confidence and even with the expected interest rate rises in the coming 12 months, our rates will still be relatively low,” adds Mr Lardner.

This article was republished from Raine & Horne Terraine October 2009.

Watch this Youtube Video about how Raine & Horne Glenelg can help you with all of your investment needs…

Monika Bonet is the Principal of Raine & Horne Glenelg, your Glenelg Real Estate Agent and Property Management expert.

RP Data – Rismark Home Value Index Release

National property values jumped by almost 2 per cent in August in the largest monthly movement since the RP Data-Rismark Home Value Indices began in January 2005. 

Using the rpdata.com (ASX: RPX) property database, which is Australia’s largest and includes over 170,000 sales during the first eight months of 2009, Australia’s housing recovery solidified during the month of August with strong capital gains registered across the country despite evidence of fading first home buyer numbers.

According to the “market-leading” RP Data-Rismark National Home Value Index (see Background on p4), home values in Australia rose by an exceptional 1.9 per cent during the month of August. This brings cumulative capital growth in the first eight months of 2009 to a better than expected 7.9 per cent. This is also the single highest monthly index result since the RP Data-Rismark National Home Value Index began in January 2005.

According to rpdata.com research director, Tim Lawless, the August results surprised on the upside and are indicative of very high levels of buyer confidence combined with low levels of listings.

“These buoyant conditions sit in striking contrast to the same time last year when values were falling, less than half of the auctions held cleared and sales volumes were at rock bottom.  We are now seeing home values rising at a solid rate, almost 80 per cent of auctions are clearing, and sales volumes have bounced back significantly”, Mr Lawless said.

Rismark International managing director, Christopher Joye, added, “Australia’s housing market is being underpinned by the strongest population growth since 1971, record housing shortages, historically low mortgage rates, better than expected employment outcomes, and one of the world’s most profitable banking systems.”

Australian home values have now risen 3.8 per cent past their February 2008 peak. This rebound followed peak-to-trough falls in national home values of just 3.8 per cent in 2008, which compares exceptionally well with the 15 per cent and 30 per cent house price declines seen in the UK and US, respectively.

Dispelling concerns that the recovery is limited to first home buyers Mr Joye commented, “In contrast to claims that this is a first time buyer bubble, the cheapest 20 per cent of suburbs in Australia have actually under performed both the mid-priced market and Australia’s 20 per cent most expensive suburbs since the housing market bottomed in December 2008.”

“As recently noted by the RBA, all major lenders now require a minimum 10 per cent deposit and are applying the strictest credit standards we’ve seen in over a decade. Australian housing credit growth has also been running at levels that are extremely low by historical standards and noticeably less than the growth experienced in the 1991 recession,” Mr Joye said.

Rpdata.com’s Tim Lawless concurred with Mr Joye and said that over the last three months the premium residential market increased in value by 4.5 per cent compared with a 3.4 per cent gain in the middle market and a 2.8 per cent improvement at the cheapest end. (Note: numbers in chart  to right show changes since December 2008 in the cheap, middle market, and expensive suburbs.)

“Despite the strong gains, the bounce in the premium sector has not been enough to offset the peak to trough fall of 9.9 per cent between February 2008 and January 2009.  Prices in Australia’s most expensive markets are still 1.1 per cent lower than at their peak.”

Mr Joye added, “While the resounding recovery in Australia’s housing market confirms our forecasts, we expect medium term growth rates to be more measured as mortgage rates normalise back to between 7-8 per cent. This would bring the cost of housing finance back in line with its 2000-01 levels, which is notably well below the searing 9.6% highs endured by borrowers in August 2008 care of the RBA.”

In closing Tim Lawless said that the upward momentum in Australian house prices is a critical economic signal from the market to builders and developers to encourage them to reinvest in producing new housing supply. This was a message reinforced by the RBA’s Dr Anthony Richards in a speech to CEDA yesterday: policymakers need to facilitate significant new investment in housing supply to alleviate Australia’s growing housing shortage, which ANZ and Westpac estimate has risen to around 200,000 homes.

“This price growth will also go a long way to comforting risk-averse lenders to start providing credit again to developers, which has been one of the main bottlenecks on the supply-side. And it will stimulate the reallocation of resources away from other sectors of the economy into much-needed housing investment.” Mr Lawless said.

Other key findings from the August RP Data-Rismark Index results:

Unit values (+2.1 percent) have marginally outperformed house values (+1.8 percent) in the month of August. Over the course of 2009, units (+8.5 percent) have also generated slightly higher capital growth than houses (+7.7 percent).

Most capital cities recorded robust gains in the month of August with every single city experiencing rises in home values during the first eight months of 2009.    

After several years of subdued growth following the end of Australia’s last housing boom in 2003, which saw Australia’s “house price-to-income ratio” fall by nearly 20 percent through to December 2008, home values in the two major capital cities, Melbourne and Sydney, have led the recovery in 2009 with total capital gains of 11.6 per  cent and 8.6 per  cent, respectively.

Following Melbourne, Darwin has been the next best performing capital city with growth of 9.7 per  cent in 2009. Interestingly, Darwin also continues to deliver the highest rental yields, implying that the market may have room for further growth.

Home values in Canberra (+6.7 percent), Brisbane (+5.2 percent), Perth (+4.1 percent) and Adelaide (+3.1 percent) have also realised sustained gains in 2009.

As RP Data-Rismark correctly anticipated, residential real estate in Perth has experienced a recovery in 2009 after a period of falling prices since September 2007. While Perth dwellings have recorded 4.1 percent growth in the first eight months of the year they still remain 3.6 per  cent below their September 2007 peak.

National rental yields have softened slightly given the strong capital growth with the gross annualised rental yield for units being 5.1 percent while house rental yields are slightly lower at 4.3 percent.

This article republished from RP Data -- Rismark

Watch this Youtube Video about how Raine & Horne Glenelg can help you with all of your investment needs…

Monika Bonet is the Principal of Raine & Horne Glenelg, your Glenelg Real Estate Agent and Property Management expert.

Raine & Horne Glenelg is proud to support the Hudson Maher Foundation… a very worthy foundation helping families cope with life-threatening bone marrow disease.

The Adelaide 36ers new season is fast approaching and the 36ers have kindly said they would donate 25% from any new membership sign up to the foundation.

Please support the Hudson Maher Foundation by purchasing your Adelaide 36ers Membership NOW!.

All you have to do is fill the Application form in with the Hudson Maher Foundation logo on (which I have attached) …… click here to download Application Form

Please support the 36ers and the Foundation and sign up….. watch this Slide Show to learn more ….

If you want to know more contact Dean Parker on dean@adelaide36ers.com.au or give him a buzz on 1300SIXERS ( 1300749377) 

Get those memberships in……Cheers and thanks to all those who provide their wonderful support of the Hudson Maher Foundation and the Adelaide 36ers….

Raine & Horne has launched rh OpenHome, the world’s first automated service, which will allow buyers to privately register personal details at an open home. 

The new service has been rolled out in NSW as a first trial, rh Open is linked to Raine & Horne’s unique real estate client database system, rhcompass, and can be operated via a laptop with wireless access or a mobile phone, and will help agents capture valuable buyer information, which will help them deliver property information to buyers on the spot. 

Angus Raine, CEO, Raine & Horne, explains, “A Raine & Horne agent or a buyer can enter information such as names, mobile phone numbers and email addresses into rh OpenHome. “It’s extremely clever as the rhcompass database then immediately matches the buyer’s property requirements with similar properties listed with Raine & Horne in the same location. Within seconds, an email or text message can be sent to the buyer’s computer or mobile phone with details about houses or apartments in their price range. 

“The new service will also notify buyers when a new property hits the market.” rh OpenHome will also update buyers if the price of property is adjusted in any way,” said Mr Raine. “It takes the frustration out of property searching.”

 If buyers are in the hunt for a mortgage, rh OpenHome can also link them with Raine & Horne Financial Services. “They simply click this option on rh OpenHome or give permission to have that option ticked and they’ll be contacted by Raine & Horne Financial Services within 24 hours.” 

Vendors are also set to win with rh OpenHome. “The most common and immediate question asked by sellers is, ‘how many buyers came through today?’” said Mr Raine. “With rh OpenHome, property sellers can be alerted almost immediately about open house interest. Generally this information takes hours to deliver as it’s entered manually into a database before it can be emailed.” 

Ray Fadel from Raine & Horne San Souci, who was involved in testing rh OpenHome, says the new system saves him and prospective buyers significant time. “It’s cutting edge as I can use an iphone to collect buyer details and send information.” 

Sydney based investor Peter Kambos, who spends many weekends searching for properties, says rh OpenHome is a great initiative. Mr Kambos who visited a number of Raine & Horne open houses recently, said, “As soon as I got home I had some properties waiting for me on my computer, which was great. They were in my price range and rh OpenHome will save me time.” 

Mr Kambos who owns Sydney-based project management firm Alliance Project Services (www.allianceprojectservices.com.au), says looking for the right properties “is a pain and having a service like this is quite helpful.” Mr Kambos agreed rh OpenHome’s privacy benefits were attractive.  

With superannuation funds taking a severe battering in the 2008/09 financial year, residential property continues to star.

According to the latest RP Data-Rismark Monthly Indices Release, Australian housing values were up 3.9% in the first five months of 2009. The improvement in market conditions, says RP Data, can be attributed to increased owner-occupier demand as opposed to more investors returning to bricks and mortar.

However Angus Raine, CEO, Raine & Horne says he expects more investor interest as we move deeper into 2009. “We’ve seen it in the past, but as first home owner interest declines, investors are set to fill the void,” explains Mr Raine. “Given many property markets are experiencing very low vacancy levels, it will be difficult for savvy investors to ignore the healthy yields that a quality, well-located investment home can produce.”

Other factors supporting property values include Australia’s growing population. Dr Alex Joiner, an economist from ANZ explains, “Population growth is running at its highest level in four decades, providing an unprecedented call on national dwelling stock. This is being reflected in rental vacancies at historical lows in most capitals.”

He adds, “Housing supply has been inhibited by high development costs, land availability and developer uncertainty. The now chronic demand/supply imbalance will intensify upward price pressures, providing a key signal to investors and developers alike to engage the market for the first time in a number of years.”

Mr Raine adds the impact of the Reserve Bank’s decision to cut rates should not be underestimated. Around 80% of Australian home loans are variable rate mortgages, according to Raine & Horne Financial Services, while Mr Raine says roughly 75% of American home loans, for example, are fixed rate loans for 30 years. “So when the US Federal Reserve cut rates, the impact for home owners and investors is minimal,” explains Mr Raine. “In comparison, with the RBA slashing rates by 4% since September last year, the monthly mortgages paid by most Australian home owners are many hundreds of dollars cheaper, which is helping to underpin consumer confidence.”

As a result of lower interest rates, ANZ reports housing affordability in Australia is “testing record highs”. Mr Raine explains, “This means that buying residential property is more affordable for more Australian workers than it’s been for some time.”

However the Raine & Horne CEO says significant increases in unemployment have the potential to affect the strength of Australia’s housing market and should not be ignored by investors. Dr Joiner agrees, but suggests the state of Australia’s labour market “is likely to present as a second-order influence on housing market outcomes.”

An Oasis of green will soon arise amid the asphalt and concrete on site when the ANZAC Memorial Garden takes shape in the south-western corner of the Gallipoli Underpass Intersection.

An integral part of the Gallipoli Underpass urban design, planting has begun to create the garden in recognition of the Battle of Lone Pine which took place at Gallipoli in August 1915.

Nine thousand soldiers died at the battle where seven Victoria Crosses were subsequently awarded.

This August some 94 years later, a ceremony will be held to unveil the garden and plant a lone pine in memory and recognition of those who have and do serve Australia and New Zealand in the theatres of war.

Members of the Veterans Affairs Council will be invited to participate in the unveiling along with the representatives of the New Zealand Defence Force.

The commemorative theme will also permeate through landscaping on each of the four sides of the Gallipoli Underpass. It will include the installation of four feature walls honouring the Australian Army, Navy and Air Force and the New Zealand Defence Force.

An interpretation of the Australian Army’s Rising Sun has been incorporated into the underpass bridge design. The badge’s bayonets are represented on the bridge and coloured red to regognise the eternal flame – a perpetual symbol of the gratitude Australian’s have for the sacrifice their soldiers have made.

 This story was reproduced from the New Connection – Issue 4 Winter 2009