ME quarterly property sentiment snapshot. · ME QUARTERLY PROPERTY SENTIMENT SNAPSHOT | 3 Overall property sentiment Positive property sentiment fell 12 percentage points in April

ME quarterly property sentiment snapshot.Quarterly insights into how Australians feel about the residential property market.

FIFTH SURVEY, Q2 APRIL 2020

ME QUARTERLY PROPERTY SENTIMENT SNAPSHOT | 2

About this snapshotThe ME Quarterly Property Sentiment Snapshot provides timely insights into the sentiment of Australians towards the residential property market based on a survey of 1,000 Australian adults in the property market who do not work in the market research or public relations industries.

The survey is designed, developed and produced quarterly by industry super fund-owned bank ME with fieldwork conducted by Pure Profile.

This edition presents the findings from the fifth edition – Q2 of the 2020 calendar year, conducted in April 2020.

The snapshot tracks changes overtime in property sentiment and in doing so, highlights the ongoing – and potentially shifting – differences between ages, locations, property status, intentions and experiences in terms of:

• overall property market sentiment• price expectations• impacts on future property plans • impacts on finances, wealth, and savings behaviour • impact of recent events For analysis, the sample is broken down into investors, owner occupiers and first home buyers in the following proportions to provide accurate results within each cohort:

• 535 – Owner occupied property owners • 328 – Investment property owners • 224 - First home buyers The data has been weighted to be nationally representative across age, gender, and location.

For further information.Matthew Read General Manager Communications

T 0432 130 338 E [email protected]

Jennifer Timm Consumer PR Manager

T 0403 369 707 E [email protected]

Level 28, 360 Elizabeth Street Melbourne, VIC 3000 Australia

mebank.com.au


Overall property sentimentPositive property sentiment fell 12 percentage points in April (Q2) compared to January (Q1) this year. Sentiment varies by age, property status and property intentions.

0%

10%

20%

30%

40%

50%

37

35

28

42

33

26

42

34

24

4144

29

27

39

20

■ Negative ■ Neutral ■ Positive

Q22019

Q32019

Q42019

Q12020

Q22020

75+ years

55–74 years

40–54 years

25–39 years

18–24 years

34 36 303946

28 331836

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

42 29 29

27 51 2233 57 1039 40 2136 47 17

29 46 2432 42 2639 46 15

30 47 2344 37 1940 38 22

38 33 29

51 25 2443 35 22

38 2537

23 56 21

19 50 31

25 47 28

37 37 26

42 30 28

27 41 32

31 44 25

■ Positive ■ Neutral ■ Negative

0% 20% 40% 60% 80% 100%

Figure 1. Overall property sentimentOverall, how do you feel about the property market?

Figure 2. Property sentiment by ageOverall, how do you feel about the property market?



0% 20% 40% 60% 80% 100%

Owner occupier

Investor

First Home Buyer

35 44 2146 32 2246 40 14

44 29 2740 34 26

27 38 3530 37 33

32 35 33

31 43 26

51 30 1945 38 17

26 49 24

29 44 27

34 35 30

27 38 35Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

21 51 28

35 28 37

48 32 19


0% 20% 40% 60% 80% 100%

Intend to buy

Intend to sell

Intend to do nothing

32 41 27

33 47 20

24 49 2725 47 28

58 18 24

49 27 24

44 23 3333 26 41

63 22 15

52 30 18

51 30 1953 23 24

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Figure 3. Property sentiment by property statusOverall, how do you feel about the property market?

Figure 4. Property sentiment by property intentions Overall, how do you feel about the property market?


House price expectations Overall, more people are predicting house prices to decline, and less are expecting them to rise over the next 12 months; however, expectations vary based on property status and location.

Q22019

Q32019

Q42019

Q12020

Q22020

■ Down ■ Stay the same ■ Up ■ Not sure

11

2928

32

17

14

30

38

13

10

30

47

10 13

10

25

41

55

0%

10%

20%

30%

40%

50%

60%

20

26

Figure 5. Overall house price expectationsWhat do you think is likely to happen to the value of your property in the next 12 months?

195748

3827

21524837

32

20

564640

38

389

12

1427

4412

1219

30

46

1013

22

29

292531

3336

262732

32

30

20

2224

24

20

0% 20% 40% 60% 80% 100%

Owner occupier

Investor

First Home Buyer

■ Up ■ Down ■ Stay the same

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Figure 6. House price expectations by property statusWhat do you think is likely to happen to the value of your property in the next 12 months?

Figure 7. House price expectations by stateWhat do you think is likely to happen to the value of your property in the next 12 months?

Please note, survey sample sizes for other metro areas are smaller and are therefore not included.

21

17

56573224

206757

3833

1957574436

1043

2530

56464536

1115

2241

407

6

1836

3898

1524

5114

2815

26

454

12521

2322

3325

2717

27

2725

272524

2231

2530

3646

39

2931

3236

31

NSW Metro

VIC Metro

QLD Metro

WA Metro

SA Metro

0% 20% 40% 60% 80% 100%

■ Up ■ Down ■ Stay the same

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020


Property intentionsME asked people in the property market what their property plans are over the next 12 months and found more people are planning to hold. Intentions vary by age, income and property status.

0% 10% 20% 30% 40% 50% 60% 70%

58

34

12

59

33

15

5865

3629

1014

63

31

11

■ Neither buy nor sell property■ To buy property ■ To sell property

Q22019

Q22020

Q12020

Q32019

Q42019

Figure 8. Overall property plansWhat are your property plans in the next 12 months?

0% 20% 40% 60% 80% 100%

■ To buy property ■ To sell property ■ Neither buy nor sell property

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

75+ years

6 3 945 8 883 5 94

10 6 88

5 7 90

55–74 years

9 14 78

20 14 72

12 11 81

15 11 78

17 9 76

40–54 years

39 18 54

38 15 56

28 10 67

29 11 6629 12 62

25–39 years

53 16 42

45 15 48

45 11 49

44 10 5052 16 38

18–24 years

34 12 5751 13 4237 12 56

45 13 5041 6 53

Figure 9. Property plans by ageWhat are your property plans in the next 12 months?


Figure 10. Property plans by incomeWhat are your property plans in the next 12 months?

0% 20% 40% 60% 80% 100%


Under $50,000

22 9 7121 10 7118 10 75

24 9 70

26 6 70

$50,001 to $75,000

28 9 6436 14 5727 11 67

29 7 6735 14 53

$75,001 to $100,000

39 17 53

41 15 5531 5 66

28 12 6529 16 59

$100,001 to $125,000

Over $125,000

45 18 4941

37

16 5112 55

38 13 5739 11 54

36 22 5538 14 55

39 14 56

45 17 5143 14 52Q2 2019

Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

0% 20% 40% 60% 80% 100%


Owner occupier

Investor

First Home Buyer

28 1724 13

22 11

37 2944 2744 23

46 242 238 1

6327 15 6718 8 78

71

76

4839 24 4839 23 47

4239

5351 3 4842 1 57

5661Q2 2019

Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Q2 2019Q3 2019Q4 2019Q1 2020Q2 2020

Figure 11. Property plans by property statusWhat are your property plans in the next 12 months?


Effect on financesChanges in house prices influenced respondents’ financial situation in a variety of ways, both positive and negative.

27%net negative 1%

net negative 4%

28%

24%net negative 4% 28%



36%21%38%21%

net positive 15%

net positive 17%

28%net negative 2%

net negative 10%

30%


net negative 4% 27% 23%

net positive 4%22% 26%

Q2 2019

Q3 2019

37%20% net positive 17%Q4 2019


Q2 2019

Q3 2019net positive 9%20% 29%Q4 2019

net positive 4%20% 24%Q1 2020

Q2 2019

Q3 2019

25%net negative 3% 28% Q4 2019

20%net negative 8% 28% Q1 2020

Q2 2019

Q3 2019

33% net positive 6%27% Q4 2019


Q2 2019

Q3 2019



net positive 1%19% 20%Q2 2020

17%net negative 17% 34% Q2 2020

21%31% Q2 2020

21%25% Q2 2020


Sense of wealth

Willingness to spend on discretionary items like entertainment or eating out

Savings behaviour

General financial confidence

Debt situation

■ Negative ■ Positive

Figure 12. Overall effect on finances*What impact have recent property price movements in your area had on these aspects of your financial situation?

* Respondents had the choice of answering positive, negative or neutral. We have removed neutral responses from the chart for the sake of simplicity.


19%23%

27%

21%37%

29%

31%34%

31%

33%26%

23%

39%28%

36%

21%20%21%

■ Negative impact ■ Positive impact

Q2 2019Q3 2019Q4 2019

29% 28%Q1 2020

Q2 2019Q3 2019Q4 2019

23% 31%Q1 2020

Q2 2019Q3 2019Q4 2019

16% 33%Q1 2020

27%16% Q2 2020

31%25% Q2 2020

21% 21%Q2 2020

%

Owner occupier

Investor

First Home Buyer

23% 35%26% 26%

29% 22%

22% 41%34% 31%

31% 34%

42% 23%39% 24%

33%

Owner occupier

Investor

First Home Buyer28%


Q2 2019Q3 2019Q4 2019

36% 28%Q1 2020

Q2 2019Q3 2019Q4 2019

24% 34%Q1 2020

Q2 2019Q3 2019Q4 2019

19% 28%Q1 2020

17% 34%Q2 2020

25% 36%Q2 2020

21% 26%Q2 2020

Figure 13. Sense of wealth by property status*What impact have recent property price movements in your area had on this aspect of your financial situation?

Figure 15. General financial confidence by property status*What impact have recent property price movements in your area had on this aspect of your financial situation?

26%27%

27%

25%36%

33%

33%41%

32%

25%21%

20%

30%26%

27%

23%34% 22%

29% 19%

22% 22%

19%24%

Owner occupier

Investor

First Home Buyer


Q2 2019Q3 2019Q4 2019Q1 2020

Q1 2020

Q1 2020

41%14%

38%21%

28%16%

Q2 2020

Q2 2020

Q2 2020

Q2 2019Q3 2019Q4 2019

Q2 2019Q3 2019Q4 2019

Figure 14. Willingness to spend on discretionary items by property status*What impact have recent property price movements in your area had on this aspect of your financial situation?

18%20%

25%

19%30%30%

24%23%

24%

16%

24%28%

30%26%

20%

37%32%

30%

20%26%

17%

Owner occupier

Investor

First Home Buyer


Q2 2019Q3 2019Q4 2019

19%Q1 2020

26%Q1 2020

27%Q1 2020

17%

26%

18%

21%Q1 2020

28%Q1 2020

13%Q1 2020

Q2 2019Q3 2019Q4 2019

Q2 2019Q3 2019Q4 2019

Figure 16. Debt situation by property status*What impact have recent property price movements in your area had on this aspect of your financial situation?



20% 34%19% 33%

20% 29%

18% 42%28% 39%

24% 41%

23% 40%20% 47%

21% 40%

Owner occupier

Investor

First Home Buyer


Q2 2019Q3 2019Q4 2019

24% 37%Q1 2020

20% 37%Q1 2020

14 35%Q1 2020

38% 21%Q2 2020

42% 22%Q2 2020

29% 17%Q2 2020

Q2 2019Q3 2019Q4 2019

Q2 2019Q3 2019Q4 2019

Figure 17. Savings behaviour by property status*What impact have recent property price movements in your area had on this aspect of your financial situation?



AffordabilityHousing affordability remains a key concern, with 90% agreeing it is a big issue, unchanged from last quarter.

Figure 18. Housing affordability is a big issue in Australia Do you agree or disagree with the following statement?

88

93

89

90

90

Housing a�ordability is a big issue in Australia

Q2 2019

Q3 2019

Q4 2019

Q1 2020

Q2 2020

0% 20% 40% 60% 80%10% 30% 50% 70% 90% 100%


Impact of recent events Events such as bushfire, the COVID-19 pandemic and economic downturn have influenced sentiment in the real estate market.

Figure 19. Property plans after the bushfires*Do you agree or disagree with the following statement: The recent bushfires have affected my decision to buy or sell property

Figure 21. COVID-19’s impact on buying and selling activityDo you agree or disagree with the following statement: COVID-19 will affect my decision to buy or sell property

Figure 20. COVID-19’s impact on the real estate market*Do you agree or disagree with the following statement: COVID-19 will negatively impact the Australian real estate market

0% 10% 20% 30% 40% 50%

■ Net agree

28

27

30

41NSWregional

Total

Metro

Regional

Total

■ Net agree

Owner occupiedproperty owner

Investor propertyowner

First HomeBuyer

55

52

59

56

0% 10% 20% 30% 40% 50% 60%

83

82

83

80

88

83

83

82

87

82

87

Total

NSW Metro

VIC Metro

QLD Metro

WA Metro

SA Metro


Investor property owner

First HomeBuyer

Intendto buy

Intend to sell

■ Net agree

50% 60% 70% 80% 90%

Figure 22. Economic downturn could be good buying opportunity* Do you agree or disagree with the following statement: An economic downturn will be a good opportunity to buy

Total

NSW Metro

VIC Metro

QLD Metro

WA Metro

SA Metro



First HomeBuyer

■ Net agree

50% 60% 70% 80% 90%

84

86

80

81

87

83

83

82

87

* Please note, survey sample sizes for other metro and regional areas are smaller and are therefore not included


Figure 24. Perceived impact of record low interest rates. Do you agree or disagree with the following statement: Record low interest rates have made buying or investing in property more attractive to me

Figure 23. Impact of COVID-19 restrictions around in-person auctions* Do you agree or disagree with the following statement: COVID-19 restrictions around in-person auctions and property inspections have delayed my decision to buy or sell

Total



First HomeBuyer

Intend to buy

Intend to sell

■ Net agree

70

66

72

75

80

64

50% 60% 70% 80% 90%

Total

NSW Metro

VIC Metro

QLD Metro

WA Metro



First HomeBuyer

Intend to buy

Intend to sell

■ Net agree

30% 40% 50% 60% 70%

51

56

58

47

54

51

50

53

59

62

* Please note, survey sample sizes for other metro and regional areas are smaller and are therefore not included

Documents

ME quarterly property sentiment snapshot. · ME QUARTERLY PROPERTY SENTIMENT SNAPSHOT | 3 Overall property sentiment Positive property sentiment fell 12 percentage points in April