This Housing Downturn is Over

I will do that when we have sold. It is my intention to post the story of our experience once this occurs as there are too many doomsayers on PC at the moment .

I just drove past the house behind ours. It has been on the market for months, and I mean months.

It has a SOLD sticker on it. It was un-sold last time I drove past, about 10 to 14 days ago.

I know the REA. I have texted him asking for the Sold Price .

I know what you mean but this one is real .

 

I hear there are some hot deals on Mascot tower atm. Better get 'cracking' though...

 

The REA has replied. Price $1.9M, on the market for 4 months, 110 groups though.

Another property a few doors down sold for $1.02M on 10th May 2019, a week before the Federal Election. The vendor probably thought Labor would get in (like the rest of us) and prices would fall.

I have inspected both properties and know both REAs.

The $1.9M house is a better house but I don’t feel it is $900K better.

To me, one is a pre-election price and the other is a post-election price.

Don’t forget, the median price for Brisbane houses for the 12 month to the end of March 2019 went up by 1.5% and that was just after the RC and before the election Labor was a shoe-in to win.

Strap yourselves in. The Brisbane BOOM is on its way .

 

CoreLogic Home Property Value Index Monthly Indices - Sydney, Melbourne, Brisbane, Perth, Adelaide, Darwin, Canberra & Hobart
According to corelogic it dropped 2.3% last year and is dropping at a rate of 0.6% per month. The rate of decline is increasing as well. I see Brisbane dropping at least 5%. I think Brisbane will fare better than other places like Sydney and Melbourne but faring better just means a lesser drop. That's my gut feeling. I actually hope I'm wrong

 

No domain app is fine - withdrawn is clearly not 15% as claimed by @berten, a number he used to rubbish this week’s highest clearance rate in 2 years.

 

Yay!! Hope you sell 20% above the market!!

 

Sorry I've lost you. I don't know what my quote was in relation to and I don't understand your response. Was it a post way back in this thread?

 

When acknowledging a Sydney house price recovery comes with the real prospect of angering a lot of people, you really have to wonder about the expectation created by certain politicians in the last election.

 

Sorry it was in response to @kierank ‘s post. Somehow got mixed while removing quotes.

 

When using the total number sure the withdrawal rate is roughly 9.5%

When comparing to the known results it sits at about 13% not quite 15% but close.

This picking and choosing which "group" or "category" to base your math on is exactly what I was pointing out was a problem earlier.

If you want to refer to say the withdrawal rate was 9.5% you probably should also say that the clearance rate was about 56%.

If you want to say the withdrawal rate was about 13% then you should also probably say the clearance rate was 71%.

Now I'm not going to claim I am great with stats, so if I am completely wrong and someone here who does this kind of math for work can point that out to me, then cool no problem. The above makes sense to me when I try to analyse these numbers.

 

Absolutely no doubt that agents don’t report as they know the media, and in turn the public, are obsessed with clearance rates and it directly affects he sentiment of the market. Selling properties puts food on the agents table. Why would they report anything that could have a negative effect on their ability to make money? It’s a no brainer. Sydney is no where near any sort of boom.

 

It is off, the number of unreported results used to be much lower, 10% or so. Now we're seeing some weeks with a third not making it into the results, and since the results are ALWAYS revised down (often considerably) this is honestly just very murky. If the results were often revised up, it would be less questionable, but the fact they're pretty much always revised down several percentage points at least suggests REAs are just not reporting negative results (if they forgot to report positive results, the rate wouldn't always come down).

 

Reminds me very much of Celtic Tiger builds. The lawsuits are still going strong. Lots of cracking walls and foundations, leaking, rising damp, boom time builds are often just terrible quality.

 

I suspect they got it from 44 withdrawn as a percentage of 266 sold. Which is about 15% (actually slightly higher). If you take 44 as a percentage of 471 it's closer to 10%. Still seems high.

 

Get ya facts straight, matey. Withdrawns have been running at 10-15% consistently since the downturn gathered pace. Even with unreported up and volumes down.

 

I've always found Australia's fixation on clearance rates weird. They're a useful statistic if you're looking at a trend. Week to week not so much.

I remember having this discussion with a poster here about a year ago, when if I recall rates had gone up to the mid 60s for a few weeks in winter. I explained they're really only helpful as a longer term trend, and as a comparison to the year before. Week to week and even month to month they're not much help. If you see them trended on an annual basis, you can see they're very seasonal. They're often strong in winter, weak in summer, and somewhere in between at other times.

In times of low volumes they are also pretty unreliable especially if there's a high rate of non-reporting. I mean we're looking at a sample pool here of 266 sold properties out of 471 planned and advertised auctions, which isn't 71% in any universe. A 30% unreported rate is just crazy high. Even despite this, though, a couple of hundred results is pretty easy to sway statistically speaking.

Last week was very low, this week is very high, and the conclusions being drawn from these trends are sketchy at best.

The number will almost certainly be revised down to the low-to-mid 60s where it's been for months. It will take months to know what's going on, because trends take a long time to unfold. We could see the same summer retrace we saw last year, we could see an improvement. Declaring the boom back or the bust ongoing is massively premature. Let's get through the weakest period (summer) first and see how spring goes.

 

My issue is more with corelogic than domain. They use the same format I think for determining their clearance rate statistic. They are not in the business of selling houses they are in the business of selling quality data. They could improve their data quality by providing incentives for accurate reporting. If they based their statistic on the overall pool you couldn't game the stat so easily.

 

No, we are aiming for 50% increase on what it was passed in at an auction in September last year .

 

The current chart of back-series data from Core Logic for the Daily Home value index is:




CoreLogic Home Value Index - Back Series | CoreLogic

The great thing about this data is that it takes into account all sales, whether it be private-treaty or auction.

I then downloaded the back series data linked above and applied the following analysis:

1. Calculated the daily %-change in the index value
2. Calculated the rolling average of the daily %-change in the index value for 7-day periods
3. Calculated the rolling average of the daily %-change in the index value for 28-day periods

Conditional highlighting has been applied in the following groups:

1. Daily %-change in index value ( for each city and aggregate )
2. 7-day rolling average of %-change in daily index ( for each city and aggregate )
3. 28-day rolling average of %-change in daily index ( for each city and aggregate )

Midpoint (0-change) is set as white colour. Green for positive change and red for negative change.

Generally the 28-day rolling average is the figure to watch for confirmation of green shoots and the 7-day rolling average an early indicator. That's if you don't want to wait for quarterly data.

Sydney:

• Low point for index was 151.0 on 19 May. Definite green shoots on 28-day rolling average of daily change in index.

Melbourne:

• Low point for the index was 139.49 on 6 June. Another 1 to 2 weeks of data need to determine if this is the bottom but 28-day and 7-day rolling averages may confirm we have passed the bottom for Melbourne ( approx 1 month after Sydney ).

Brisbane:

• Current slowing negative trend on the 7-day rolling average. Low-point on the index is 106.02 yesterday. Need another 2-4 weeks to see if the negative changes will continue slowing.

Adelaide:

• Low-point on the index is 116.3 on 21 May. Green shoots showing on 28-day rolling average.

Perth

• Low-point on the index is 87.88 yesterday. 7-day rolling average may point to index turning positive soon. Need to see if this continues. Negative outlier in data on 20 May is affecting the 28-day rolling average significantly.

Aggregate:

• Low-point on the index is 131.32 yesterday. 28-day rolling average is pointing to this turning positive. Rate of negative change is slowing on the rolling average 28-day data.

 

But it now excludes off the plans which makes the whole data series pretty crap imo, especially given the massive construction boom we've seen in recent years. It didn't used to exclude them. It doesn't make sense to exclude them. It seems quite misleading to exclude them (they're upfront about it, but of course commentators forget or are often unaware the index just doesn't report on the weakest part of the entire housing market).

Ignoring off the plans could be masking very serious weakness in the apartment and whole new construction market. Apartments have seen some of the steepest discounting.