Housing Facts

Housing finance

  • Money borrowed to buy Australian housing = $22.7 billion over last 12 months (year ending Sept 2013).  It was $19.8 billion the year before.  Increase of 15% on last year.
  • About 55% or $12.6 billion was borrowed by owner-residents; $10.1 billion by investors.  Some change in owner resident borrowings (up 11%) but big lift in investor interest, up 20% on last year.
  • Borrowing for new property & housing construction was $3.5 billion, up from $3 billion a year ago.
  • First home buyers = $2.5 billion, down from $2.9 billion on last year.  86,000 first home buyers borrowed money to buy a home this year versus 103,000 the year before.
  • Average amount borrowed is $305,000 across all borrowers – little change in recent years.  First timers borrow, on average, $290,000.
  • Money borrowed by non-individual investors (such as SMSFs) was $0.9 billion last year, up from $0.7 billion the year before.  A change of 30%.

Comments:

  • More are borrowing to buy property.
  • First home buyers are being somewhat beaten at the post by investors, but are more likely experiencing life & renting, often sharing accommodation in the process.  Many feel they have missed out or don’t see home ownership as a pathway to financial success.  This will have an impact on housing demand – i.e. baby boomers downsizing & trying to sell their larger homes to the younger market as well as the underlying demand to build new homes.
  • Whilst volumes borrowed have increased, the actual amount borrowed hasn’t changed.  Many are utilising their homes more efficiently.  Larger loans aren’t happening yet.
  • SMSFs are still a small component of the investor market but they are increasing with ‘a bullet’.

House size

These statistics come from recent work – also published today – by Craig James from CommSec.  Go here for more.  Craig is the good-looking guy, with a dashing smile & fantastic hairdo.

CommSec has found:

  • The average size of new houses across Australia is falling – whilst they are still big on the world stage – they are getting smaller, averaging 241 sqm today, the smallest size in over ten years.
  • Twenty years ago, the average new house in Australia, was 180 sqm & 30 years ago it was 160 sqm.
  • New houses in NSW are 266 sqm; Victoria 243 sqm; Queensland 240 sqm; Western Australia 235 sqm & 201 sqm in Tasmania.
  • The average size of a new attached dwelling (townhouses & apartments) is 134 sqm across the country, down from 143 sqm about ten years ago.
  • New apartments in NSW average 151 sqm; 133 sqm in Victoria; 131 sqm in Queensland; 138 sqm in WA and just 79 sqm in Canberra.

Comments:

  • We are now building smaller homes – efficiency seems to be the main driver.  Also, as Craig points out, we are spending our money on experiences  rather than building bigger homes.  Quality is in, size maybe not.
  • Downsizing baby boomers; the want to live closer to the action; increasing travel times; the shrinking of almost everything (phones; TVs; gadgets etc.) & the trend towards more travelling (so locking up & leaving for periods of time) is changing the way we live; where we live & what we live in.
  • New homes are smaller now in Queensland, than in Victoria & NSW.   Many new homes in Queensland of recent times have been sold to investors – smaller allotments with smaller homes.  Driven by the end price point & gross rental yields.
  • Smaller apartments in Queensland too – same reasoning as above.
  • Larger apartments now in NSW, as more owner residents move into apartments in Sydney.  A trend that is set to continue & spread to other capitals.
  • ACT apartments are quite small – part-time use based around parliamentary time-table.
  • Whilst houses are still small in Tassie, they are increasing, as more baby boomers from the mainland discover the Apple Isle & move/build holiday homes.


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