The Australian property market has shown signs of slowing according to a report by Bloomberg News. The surprise report is based on Australian mortgage approvals that have fallen for a second month running. The cause appears to be the hike in Australian interest rates which are now at an 11 year high. This is in contrast to the building industry that are experiencing strength with housing construction rising 1.4 percent in the third quarter from the previous three months. In fact this increase contributed 0.1 percentage point in the quarter to gross domestic product, which rose 1 percent.
The Bureau of Statistics said in Sydney today that the number of loans granted to build or buy houses and apartments fell 0.7 percent to 62,509 from September, when they slipped a revised 2 percent. The median estimate of 21 economists surveyed by Bloomberg News was for a 1 percent increase.
Today’s report “adds to the uncertainty over a further hike” early next year, said Su-Lin Ong, fixed-income strategist at RBC Capital Markets in Sydney. “This is the first back-to-back monthly decline in 12 months,” and echoes declines that followed three rate increases last year.
Housing affordability dropped to the lowest level on record in the third quarter, according to an index compiled last month by Commonwealth Bank and the Housing Industry Association. Almost one- third of the average first-home buyer’s income is spent on mortgage repayments.
The nation’s economy, now in its 16th straight year of expansion, is benefiting from rising Chinese demand for commodities that is prompting companies such as Rio Tinto Group to boost hiring. Australia’s job-vacancy advertisements rose 0.7 percent in November, according to an Australia & New Zealand Banking Group Ltd. report released in Melbourne today.
The Gold Coast still remains popular for overseas investor with overseas property portal Homesgofast.com reporting increased interest in the Australian property hot spot. CEO Nicholas Marr ‘ Overseas property investors particularly like the Gold Coast owing to its strong tenant demand not only from Australians but also from visitors to the region. The Gold Coast appears to be growing fast with an increase in population all this makes the area an attractive proposition for foreign buyers’
The Zone is one such development causing a flurry of activity from international buyers. This off the plan development on the central Gold Coast is in the exclusive suburb of Mermaid Beach. Within walking distance beaches & restaurants minutes to Pacific Fair, Jupiters Casino, & Convention Centre. Learn more here
