RP Data Quarterly Review May 2013

7/28/2019 RP Data Quarterly Review May 2013

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Quarterly Review

A quarterly review of the residential property

market and the Australian economy

Released May 2013


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The Australian capital city housing market has started 2013 on a relatively positive footing. Capital city home values haveincreased by 2.3 per cent over the first four months of the year and home values have increased from their recent lowsacross each capital city. On an annual basis, capital city home values have risen by 2.7 per cent over the past year ranging,from a 5.9 per cent increase in Darwin to a -1.4 per cent fall in Hobart. Despite the varying performances across the capital

cities, each city has recorded value growth over the first four months of 2013. Although capital city home values have beentrending higher since June of last year, they remain -3.6 per cent lower than they were at their historic high. Home values ineach city sit below their historic highs with the magnitude of decline ranging from just -0.4 per cent in Sydney to -11.5 per centin Hobart. The number of house and unit transactions across the capital cities has also shown some subtle improvement overrecent months, Based on the annual number of sales to February 2013, there were 1.4 per cent more sales than there wereover the previous year. Although the improvement is only minor, further improvements in housing finance commitments sofar this year suggest that sales activity is likely to increase further.

Although the capital city housing market has recorded value growth of 2.3 per cent over the first four months of 2013, valuesrose by 2.8 per cent over the first quarter of the year and then declined by -0.5 per cent in April. It is important to keep inmind that our figures arent seasonally adjusted and as a result it is typically found that the first quarter of the year records themost significant increase in home values.

An ongoing recent feature of the Australian economy has been quite mixed readings on economic data. Gross DomesticProduct (GDP) has increased by 3.1 per cent over the 12 months to December 2012 however, over the past two quarters ithas increased by a much more moderate 1.3 per cent. The Consumer Price Index (CPI) was recorded at an annual rate of2.5 per cent over the year to March 2013which is right in the middle of the Reserve Banks target range however, it has risenby just 0.6 per cent over the past two quarters. Official interest rates are at their lowest levels in more than 50 years andmortgage rates are at low levels by historic standards however, the response in terms of growth in home values and a pick-upin dwelling approvals has, to-date been only modest. Retail trade has increased by 3.2 per cent over the year to March 2013and had a very strong start to the year although, trade did fall by -0.4 per cent in March. Over recent weeks the Australiandollar has weakened and slipped back below parity with the $US. The national unemployment rate sits at 5.5 per cent andalthough it has increased slightly over recent months it largely remains in check. Commodity prices and the national terms oftrade have fallen with many predicting the mining investment pipeline is either at or very close to its peak. Population growthis once again ramping up with inflows strongest into the largest states. Dwelling approvals have recorded only a moderate

increase over the past year and there has not been a consistent trend towards a greater number of approvals. The recentincrease in housing market activity is being driven by a surge in investor and upgrader activity with first home buyer activity athistoric low levels in some states.

Although values across the residential property market have increased by 2.7 percent over the past twelve months to the endof April, the performance of the housing market across the capital cities has varied significantly. Different sectors of themarket are showing quite varied performances with the most expensive suburbs recording the greatest declines in propertyvalues while home values across the broad middle priced suburbs have recorded the greatest increases in home values.

Although home values and sales volumes have been increasing over the past 12 months other indicators of the marketsperformance have been quite mixed. Auction clearance rates are much higher than they were at the same time last year andgenerally the number of properties available for sale is lower than it was a year ago, although there are some exceptions.Broadly rental rates are increasing across the capital cities however, this is largely being driven by Perth and Darwin and

rental rates are falling in Hobart and Canberra. Vendor discounting levels are slightly lower than they were a year ago butagain there are some variances across each city. The average number of days it takes to sell a home is generally higherthan it was a year ago and it will be interesting to see whether the growth in home values over the first four months of theyear starts to result in lower levels of discounting and faster selling times over the coming months.

For the remainder of 2013 we anticipate that property market conditions will continue to improve. We anticipate that capitalcity home values will continue to trend higher, albeit at a much slower pace than they have over the first four months of theyear. We also anticipate that sales volumes should continue to trend higher, also at a moderate pace due to the low interestrate environment and the potential for further interest rate cuts as the year progresses. Population growth remains strongwhich should also fuel additional demand for housing throughout 2013 however, we do not expect value growth to accelerate,rather it will be a slow and steady increase. Economic conditions remain volatile both in Australia and globally and that willcontinue to weigh on the sentiment of potential home buyers which is likely to also curtail any significant increase in home

values over the year.

Report Summary


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Property Market Overview 4Quarterly performance 4

Annual performance 4Performance across broad price segments 4

Transaction volumes 5Transactions by price point 5Property listings 5Rents and yields 6Vendor discounting 6Time on market 6

Capital City Performance 7Sydney 7Melbourne 8

Brisbane 9Adelaide 10Perth 11Hobart 12Darwin 13Canberra 14

Economic Overview 15Consumer Sentiment 15Gross Domestic Product 15Interest Rates 15Consumer Price Index (Inflation) 16Components of Consumer Price Index 16Retail Trade 16Currency Exchange Rate 17Unemployment Rate 17Commodity Price Index 18Population Growth 18

Housing Data 19Dwelling Commencements 19

First Home Buyer Finance Commitments 19Value of Investment Finance 20Volume of non-refinance vs. refinance commitments 20CPI Housing Sub categories 20

Housing Data 21RP Data Mortgage Index (RMI) 21RP Data Listings Index (RLI) 21

About RP Data 22

Disclaimers 23

Contents


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-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

Apr-97 Apr-99 Apr-01 Apr-03 Apr-05 Apr-07 Apr-09 Apr-11 Apr-13

Quarterly change Annual change

-10.0%

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0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13

Most affordable 20% Middle 60% Most expensive 20%

5.9%

3.7% 3.5%

2.7% 2.7%

2.0% 1.9%1.6%

-1.4%-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

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6.0%

7.0%

Darwi n S ydne y P erth C anbe rra Aust rali an

Capitals

Brisbane Adelaide Melbourne Hobart

Annualchange

indwellingvalue

Most affordable 20% v Middle 60% v Most expensive 20%Stratified Hedonic Home Value Index, All Dwellings, combined cap cities

Property Market Overview

Home values continue to recover over the beginning of 2013Over the three months to April 2013, home values across thecombined capital cities increased by 1.1 per cent.Combined capital city home values have been trending highersince they reached a low in May 2012, over that time they have

increased by 4.2 per cent.Home values across the combined capital cities have increasedby 2.7 per cent over the past year.In April 2013, capital city home values recorded a monthlydecrease of -0.5 per cent, following on from a 2.8 per centincrease in values over the first quarter of 2013.Over the 12 months to April 2013, house and unit values haveboth recorded increases, up by 2.7 per cent and 2.5 per centrespectively. Reflective of the annual trend, house values haveincreased by 1.0 per cent over the three months to April 2013,while unit values increased by 1.1 per cent.

Home values have increased across the majority of capitalcities over the year

Combined capital city home values have recorded a 2.7 percent increase over the year to April 2013.Across the capital cities, there has been a varied performanceover the year, with the annual change in home values rangingfrom a decline of -1.4 per cent in Hobart to an 5.9 per centincrease in Darwin.Home values have risen in each capital city except for Hobartwith Darwin (5.9 per cent), Sydney (3.7 per cent) and Perth (3.5

per cent) the best performers.As a result of the recent correction in dwelling values, currenthome values sit below their peaks across each capital city.Hobart (-11.5 per cent), Brisbane (-10.2 per cent) and Darwin (-8.4 per cent) have recorded the greatest falls in values sincetheir respective market peaks.On the other hand, Sydney and Canberra have recorded thelowest magnitude of declines in home values, falling by just -0.4per cent and -1.1 per cent respectively.

All sectors of the market have recorded an increase over theyear with the middlemarket recording the strongest gains

Over the 12 months to March 2013, home values across thebroad middlemarket suburbs across capital cities recorded thegreatest value growth at1.9 per cent.The most affordable and most expensive capital city suburbseach recorded a 0.8 per cent increase in home values over thesame timeframe.Across the major capital cities, values across the middle pricedsuburbs increased over the year across each city exceptMelbourne (-0.3 per cent).Over the past year, values across premium suburbs rose ineach major capital city except for Sydney (-3.1 per cent) and

Melbourne (-0.4 per cent).On an annual basis, values across the most affordable suburbsrose in each major capital city except for Melbourne (-3.1 percent) and Brisbane (-4.2 per cent).

Rolling quarterly and annual change in homevalues, combined capital cities, all dwellings

Capital City PerformanceAnnual change in dwelling valuesyear ending Apr 13

Source: rpdata-Rismark




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0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

May 09 Nov 09 May 10 Nov 10 May 11 Nov 11 May 12 Nov 12 May 13

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

May 07 Nov 07 May 08 Nov 08 May 09 Nov 09 May 10 Nov 10 May 11 Nov 11 May 12 Nov 12 May 13

Total listings New listings

0

,000

,000

,000

,000

,000

,000

,000

Feb-98 Feb-01 Feb-04 Feb-07 Feb-10 Feb-13

Capital cities Regional markets 5 yr average


Transaction volumes have begun to improve however,they remain well below average levels Over the 12 months to February 2013, rpdata estimates

that there were 400,314 house and unit sales across thecountry.

Sales activity over the past 12 months has increased by2.1 per cent compared to the previous year.

Over the most recent six months, sales activity has been1.2 per cent higher than over the previous six monthshighlighting a continuing improvement in transactions.

Although sales activity has increased it remains -10.8 percent lower than the five year average indicating thatvolumes remain lower than normal levels.

The annual number of sales in regional markets hasincreased by 3.3 per cent over the year compared to a1.4 per cent increase in capital cities.

Annual sales volumes nationallyFeb-98 to Feb-13

Auction Clearance rates have been much higher in 2013 to-date than they were in 2011 and 2012Across the combined capital cities, auction clearance rates arecurrently at their highest level since May 2010.Throughout 2011 and 2012 combined capital city auctionclearance rates never breached the 60 per cent mark.So far in 2013, weekly capital city auction clearance rates havebeen recorded at an average of 62.2 per cent.Despite the recent improvement in auction clearance rates, theyremain slightly below the levels recorded in 2009 and early2010.It is important to remember that auctions are generally reflectiveof the premium housing market and that less than 15 per cent ofthe total capital city housing stock is actually listed to sell by

auction. Note that the number of properties taken to auction ismuch higher in Sydney and Melbourne.The recent improvement in auction clearance rates can beattributed to a better alignment of buyer and seller expectations,whereby vendors are now more willing to meet the market priceexpectations of buyers than the same time a year ago.

Additionally, with more buyers active in the market, there is nowa heightened level of competition for stock.

Effective housing supply has fallen with fewer listings and anncrease in salesrpdata calculates the number of unique properties listed for saleeach week based on counts over the previous 28 days.Our figures include counts for new listings and counts forrelisted properties which in turn provides the total number oflistings.

Across the combined capital cities, there were 25,768 newproperties listed for sale over the past four weeks. New listingswere -9.1 per cent lower over this period compared to the sameperiod last year.Over the past four weeks there were 127,526 total homes listedfor sale across the combined capital cities.Total capital city listings are currently -4.5 per cent lower than

they were at the same time last year.Across each capital city except Darwin, the number of newlistings is lower than at the same time last year.Total capital city listings are lower that they were a year ago ineach capital city other than Melbourne and Adelaide.

Combined capital city auction clearance ratesMay-09 to May-13

ource: rpdata

Source: rpdata

Australian capital city houses and units listed for saleMay-07 to May-13

Source: rpdata

The most recent eight months of sales transactions have beenmodelled based on the historic level of revision


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0

10

20

30

40

50

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90

00

Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13

$250

$300

$350

$400

$450

$500

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

Apr-97 Apr-00 Apr-03 Apr-06 Apr-09 Apr-12

Median weekly rent Gross rental yield


Rental rates trend higher over the year while gross rentalyields are flat Rental rates across the combined capital cities have trended

higher over the past year but not at a rapid enough pace topush yields higher.

As at April 2013, the median rental rate for a typical house inthe capital cities was recorded at $476 per week, and forunits it was $442.

Median weekly house rents have experienced an increase of3.4 per cent over the past year, and unit rental rates grew bya lower 3.0 per cent.

Across the capital cities, the indicative gross rental yield for ahouse in April 2013 was recorded at 4.2 per cent and 4.9 percent for units.

As the rental market and housing supply are tightest inSydney, Brisbane, Perth and Darwin; it can be anticipatedthat these cities are likely to continue to record higher rental

rate increases than the other capital cities.

Capital city rental rates and gross yieldsApr-97 to Apr-13

Average vendor discount combined capital citiesMar-05 to Mar-13

Vendor discounting discounting is lower than at the

same time last year Vendor discounting measures the average differencebetween the original listings price and final contractprice on a property sale. It provides the best indicationabout how much negotiation is in the market and is agood proxy for understanding the balance betweenbuyers and sellers.

Over the past year, the housing market has generallyremained in favour of the buyer, this is reflected by theabove average level of vendor discounting in themarket.

Across the capital cities, the average discount rate for atypical house was recorded at -7.1 per cent in March

2013 and units were discounted at a lower rate of -6.2per cent.

At the same time in 2011, the average discount rate forhouses and units was recorded at -7.4 per cent and -6.5per cent respectively. This highlights an improvement invendor pricing expectations over the year.

Although the average vendor discounting levels haveimproved over 2012, the current discount rates showthat homes are still being discounted at a rate higherthan the historical average. This is reflective of currenthousing market conditions continuing to favour buyersmore so than sellers.

Time on market has remained elevated in March 2013 The average time on market is simply the number of

days it takes from when a property is initially advertisedfor sale to when it ultimately sells based on the contractdate.

In March 2013, houses across the combined capitalcities were taking an average of 79 days to sell and 74days for units.

In comparison, houses and units were listed on themarket for a shorter time before selling during the sametime last year, taking an average of 62 days and 53days respectively.

We suspect that the time on market has remainedelevated over the first three months of the year due to apick-up in sales activity that has seen a larger proportionof homes that had been available for sale for a long timenow selling.

verage time on market (days) combined capital citiesMar-05 to Mar-13


ource: rpdata-Rismark

0%

0%

0%

0%

0%

0%

0%

0%

0%

0%

Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13

ource: rpdata-Rismark


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-20.0%

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Combined capital cities Sydney

0

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20,000

25,000

30,000

35,000

40,000

0

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Rolling annual number of sales (LHS) Rolling five year average (LHS) Rolling quarterly number of sales (RHS)

New South Wales Market Overview

Houses Units Houses Units

Median sale price* $630,000 $486,000 $546,858 $450,000

Quarterly value change 0.7% 0.5% -2.1% -0.4%

12 month value change* 0.3% 1.8% -4.2% -0.3%

5 yr average annual value change* 2.6% 3.8% 3.6% 4.7%10 yr average annual value change* 2.7% 3.0% 4.6% 4.0%

15 yr average annual value change* 6.2% 5.1% 7.2% 6.0%

Decline in values from market peak -3.1% -0.3% -4.3% -1.8%

Estimated 12 month sales volumes 46,551 34,108 46,179 36,388

Average time on market** 43 38 50 40

Average vendor discount** -6.8% -5.1% -6.6% -5.4%

Median rental rate* $556 $489 $547 $475

Gross rental yield* 4.2% 4.9% 4.2% 4.9%

Average hold period* 10.0 8.0 9.8 7.7

2012 2011

Key Statistics to April 2013

Sydney annual capital gains vs. combined capitals

Annual and quarterly number of home sales - Sydney

New South Wales regional housing market performance to March 2013

SydneyThe Sydney market has recorded an improving trendover the past year. Home values have risen by 3.7per cent over the year to April 2013. Other leadindicators suggest that the market conditions areimproving with rents increasing over the year and

the number of properties available for sale falling.

Values 1.1% quarter 3.7% year 3.1%pa 5 years 2.5%pa 10 years 5.8%pa 15 years 0.4% from peak

Annual sales volumes 78,211 over year to February 2013 8.6% year 11.8% on five year average

Rents 2.1% quarter 2.8% year

Yields 0.0 percentage points over the quarter 0.0 percentage points over the year

Selling time 3 days over the quarter

9 days over the year

Vendor discounting 0.0 percentage points over the quarter 0.0 percentage points over the year

Region

Qtr

change

12 mth

change

5 yr avg

annual change

10 yr avg

annual change

Fall from

peak

Qtr

change

12 mth

change

5 yr avg

annual change

10 yr avg

annual change

Fall from

peak

Hunter 3.2% 5.9% 4.3% 5.9% 0.0% 1.2% 3.2% 2.7% 5.0% 0.0%

Illawarra 2.0% 2.0% 3.8% 3.8% -0.5% 1.5% 0.1% 2.7% 2.6% 0.0%

Richmond-Tweed 3.8% -1.6% 0.6% 6.3% -2.6% -0.5% -2.6% -1.5% 2.5% -11.8%

Mid-North Coast 2.7% 0.9% 3.0% 7.1% 0.0% 2.4% -1.6% 1.4% 4.4% -2.2%

Northern 2.3% 9.4% 8.4% 10.9% -0.4% na na na na na

North Western 2.6% 8.5% 9.1% 11.6% -1.1% na na na na na

Central West 1.8% 5.3% 9.1% 10.5% -1.6% na na na na na

South Eastern 1.9% 8.2% 8.8% 11.4% -0.5% 0.3% 0.7% 3.3% 8.4% -1.8%Murrumbidgee -0.1% 3.0% 3.9% 8.3% -2.1% na na na na na

Murray 3.6% 5.0% 2.8% 7.4% -0.2% 3.5% 4.8% 3.0% 6.9% -0.1%

Far West 2.6% 3.0% 4.1% 3.0% 0.0% na na na na na

Houses Units


Median sale price $650,000 $500,000 $610,000 $480,000

Quarterly value change 1.1% 1.3% 0.7% 1.7%

12 mth value change 3.8% 3.3% -2.7% -1.8%5 yr average annual value change 3.0% 3.6% 3.1% 3.9%

10 yr average annual value change 2.4% 2.6% 3.6% 3.2%


Value decline from market peak -0.4% -6.6% -4.5% -2.0%

Estimated 12 month sales volumes** 45,634 32,577 47,774 377,955

Average time on market* 58 56 52 41

Average vendor discount* -7.2% -5.1% -6.8% -5.5%

Median rental rate $572 $498 $556 $483

Gross rental yield 4.3% 5.0% 4.3% 5.0%

Average hold period 10.2 8.2 9.9 7.8

20122013

* Data to March 2013

** Data to February 2013

Sources: rpdata, rpdata-Rismark Home Value Index




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Quarterly value change 1.9% 1.6% 0.0% -1.3%











2013 2012

0

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30.0%


Combined capital cities Melbourne

Victoria Market OverviewKey Statistics to April 2013

Melbourne annual capital gains vs. combined capitals

Annual and quarterly number of home sales Melbourne

Victorian regional housing market performance to March 2013

MelbourneThe Melbourne housing market has recorded amoderate housing market recovery throughout thepast year. Home values have risen by 1.6 per centover the year to April 2013. Other lead indicatorssuggest a moderate market improvement with rents

increasing and average selling times and levels ofdiscounting remaining fairly stable over the year.




Yields 0.0 percentage points over the quarter 0.0 percentage points over the year

Selling time

2 days over the quarter 1 day over the year

Vendor discounting 0.6 percentage point over the quarter 0.0 percentage points over the year

Region

Qtr

change

12 mth

change

5 yr avg

annual change

10 yr avg

annual change

Fall from

peak

Qtr

change

12 mth

change

5 yr avg

annual change

10 yr avg

annual change

Fall from

peak

Barwon 3.2% 2.2% 6.3% 7.6% -0.9% -0.6% -7.4% 1.6% 5.5% -12.5%

Western District 2.6% 7.7% 7.4% 8.6% -0.2% na na na na na

Central Highlands -0.1% 2.7% 6.7% 7.0% -2.1% na na na na na

Wimmera 1.1% 10.1% 11.4% 14.0% -4.0% na na na na na

Mallee 2.3% 2.8% 2.2% 5.8% -0.4% na na na na na

Loddon 0.9% 6.4% 8.9% 11.1% -2.0% na na na na na

Goulburn 3.7% 3.2% 5.8% 10.2% 0.0% na na na na na

Ovens-Murray 0.3% 3.5% 4.2% 7.0% -3.5% na na na na naEast Gippsland 5.1% 14.1% 9.2% 14.5% 0.0% na na na na na

Gippsland 1.5% 1.8% 8.9% 9.9% -2.0% na na na na na

Houses Units







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Region

Qtr

change

12 mth

change

5 yr avg

annual change

10 yr avg

annual change

Fall from

peak

Qtr

change

12 mth

change

5 yr avg

annual change

10 yr avg

annual change

Fall from

peak

Gold Coast 1.2% -0.3% -2.1% 4.3% -11.2% -1.0% -6.3% -3.8% 2.8% -17.9%

Sunshine Coast 1.1% -0.5% 1.0% 7.0% -6.9% -2.1% -2.9% -2.1% 2.9% -12.1%

West Moreton 2.9% 10.1% 2.8% 11.7% -2.5% na na na na na

Wide Bay-Burnett 1.1% 2.7% 1.4% 10.4% -2.9% -0.6% -6.3% -3.5% 6.3% -21.5%

Darling Downs -0.1% 2.8% 5.0% 11.0% -2.7% na na na na na

South West 2.3% 2.6% 1.5% 8.1% -0.9% na na na na na

Fitzroy 4.3% 10.8% 5.2% 14.2% -0.9% na na na na na

Central West 2.3% 2.6% 1.5% 8.1% -0.9% na na na na naMackay 5.0% 11.1% 5.4% 16.9% -3.5% 2.8% 3.2% 4.1% 10.4% 0.0%

Northern 3.9% 4.4% 1.2% 10.5% -1.8% 0.0% -3.9% -0.8% 8.9% -14.7%

Far North 1.8% 3.3% 1.6% 10.0% -0.1% -3.0% -5.9% -3.9% 4.2% -20.1%

North West 4.3% 13.6% 7.8% 11.3% 0.0% na na na na na

Houses Units

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-10.0%

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15.0%

20.0%

25.0%

30.0%

35.0%

40.0%


Combined capital cities Brisbane

Queensland Market Overview














2012 2011


Brisbane annual capital gains vs. combined capitals

Annual and quarterly number of home sales Brisbane

Queensland regional housing market performance to March 2013

BrisbaneThe Brisbane housing market is starting to show firmsigns of a recovery after a negative average rate ofvalue growth over the past five years. Home valueshave risen by 2.0 per cent over the year to April2013. Rental rates have also increased over the

year and gross rental yields are amongst thestrongest across all capital cities.


Annual sales volumes 39,357 over year to February 2013 10.1% year 14..3% on five year average


Yields 0.1 percentage point over the quarter 0.1 percentage point over the year

Selling time

38 days over the quarter 42 days over the year




Quarterly value change -0.8% -1.5% -0.8% -1.5%

12 mth value change 1.9% 3.6% -6.6% -5.4%5 yr average annual value change -1.3% 0.1% 1.7% 2.5%










2013 2012







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Quarterly value change 2.1% 0.4% 0.9% -0.5%











2013 2012

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

0

5,000

10,000

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30,000

35,000



-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%


Combined capital cities Adelaide

South Australia Market OverviewKey Statistics to April 2013

Adelaide annual capital gains vs. combined capitals

Annual and quarterly number of home sales Adelaide

South Australia regional housing market performance to March 2013

AdelaideAdelaide home values have risen by 1.9 per centover the past 12 months highlighting a gradualimprovement in home values. Sales volumes arevirtually unchanged over the year, rents areincreasing at a moderate rate and vendor

discounting levels and the average time on markethave shown improvement over the year.



Rents 0.7 % quarter 1.5% year

Yields 0.1 percentage point over the quarter 0.0 percentage points over the year

Selling time



Region

Qtr

change

12 mth

change

5 yr avg

annual change

10 yr avg

annual change

Fall from

peak

Qtr

change

12 mth

change

5 yr avg

annual change

10 yr avg

annual change

Fall from

peak

Outer Adelaide 1.7% 3.9% 5.9% 12.2% -1.9% na na na na na

Yorke and Lower North 2.7% -1.6% 6.4% 13.0% -3.4% na na na na na

Murray Lands -1.9% -4.8% 2.5% 10.6% -11.3% na na na na na

South East 1.2% 1.8% 2.2% 9.1% -4.0% na na na na na

Eyre -0.1% -4.5% 2.1% 7.6% -7.7% na na na na na

Northern 0.3% -5.5% -0.1% 11.2% -9.4% na na na na na

Houses Units







11/23

11

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

0

10,000

20,000

30,000

40,000

50,000

60,000



-10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%


Combined capital cities Perth

Western Australia Market Overview














2012 2011


Perth annual capital gains vs. combined capitals

Annual and quarterly number of home sales Perth

Western Australia regional housing market performance to March 2013

PerthPerths housing market has recorded acomparatively strong recovery to-date, keeping inmind prior to the recovery home values across thecity had gone nowhere for more than five years.Over the past year, home values have risen 3.5 per

cent, sales volumes have increased by 26.0 percent, and rents are up by more than 10 per cent.

Values 0.0% quarter 3.5% year 0.0% pa 5 years 8.6%pa 10 years 8.9%pa 15 years 4.2% from peak




Selling time



Region

Qtr

change

12 mth

change

5 yr avg

annual change

10 yr avg

annual change

Fall from

peak

Qtr

change

12 mth

change

5 yr avg

annual change

10 yr avg

annual change

Fall from

peak

South West 3.0% 6.9% 2.4% 12.5% -0.7% 6.9% 15.5% 12.3% 13.6% -1.3%

Lower Great Southern -3.0% -7.8% -1.1% 12.0% -12.6% na na na na na

Upper Great Southern 3.9% 8.3% 3.0% 11.3% -0.1% na na na na na

Midlands -1.7% 4.8% 9.2% 17.5% -5.1% na na na na na

South Eastern 2.6% 6.0% 1.5% 10.5% -1.5% na na na na na

Central 6.4% 8.8% 8.1% 16.1% -0.9% na na na na na

Pilbara 7.8% 18.0% 19.6% 28.9% 0.0% na na na na na

Houses Units



Quarterly value change -0.2% 2.3% -1.0% 2.6%

12 mth value change 3.7% 1.3% -2.7% -3.1%5 yr average annual value change 0.0% 0.4% -0.2% 1.9%










2013 2012







12/23

12

0

500

1,000

1,500

2,000

2,500

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000



-10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

Apr-99 Apr-01 Apr-03 Apr-05 Apr-07 Apr-09 Apr-11 Apr-13

Tasmanian Market Overview














2012 2011


Hobart annual capital gains vs. combined capitals

Annual and quarterly number of home sales Hobart

HobartHobart has experienced the weakest performingmarket over the past year of all capital cities withhome values falling by -1.4 per cent. The Hobartmarket weakness has been consistent over recentyears with it also the weakest market over the past

five years. Unfortunately most other indicatorsremain weaker now than they were a year ago.

Values 1.6% quarter 1.4% year 1.1% pa 5 years 6.0%pa 10 years 7.7%pa 15 years 11.5% from peak




Selling time





Quarterly value change -2.0% 1.8% 0.9% -2.3%

12 mth value change -2.0% 3.8% -9.3% 0.4%5 yr average annual value change -1.3% 0.8% -0.2% 1.9%


15 yr average annual value change 7.8% 6.9% 7.6% na


Estimated 12 month sales volumes** 2,829 831 2,838 924






2013 2012







13/23

13



Quarterly value change 6.0% 0.6% 9.1% 2.5%



15 yr average annual value change na na na na


Estimated 12 month sales volumes** 1,911 1,103 1,633 831






2013 2012

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

Apr-03 Apr-05 Apr-07 Apr-09 Apr-11 Apr-13

0

200

400

600

800

1,000

1,200

1,400

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

Feb-01 Feb-04 Feb-07 Feb-10 Feb-13


Northern Territory Market OverviewKey Statistics to April 2013

Darwin annual capital gains vs. combined capitals

Annual and quarterly number of home sales Darwin

DarwinThe Darwin housing market has been the strongestof all capital cities over the past year and ongoingover the past five years. Over the 12 months to April2013, home values across the city have increasedby 5.9 per cent. Other indicators highlight improving

market conditions with robust rental growth, adramatic improvement in sales and lower levels ofvendor discounting.

Values 5.0% quarter 5.9% year 4.4% pa 5 years 10.1%pa 10 years 8.4% from peak




Selling time









14/23

14

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000



-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%


Canberra Market Overview














2012 2011


Canberra annual capital gains vs. combined capitals

Annual and quarterly number of home sales Canberra

CanberraThe Canberra market has recorded a 2.7 per centincrease in home values over the year to April 2013and home values are just -1.1 per cent lower thantheir record high. Despite home values trendinghigher, rents have fallen over the year and sales

volumes are down -6.0 per cent. We anticipate thelooming federal election will create a level ofuncertainty across the Canberra market over thecoming months which may further dampen buyerdemand.

Values 1.7% quarter 2.7% year 2.6% pa 5 years 5.1% pa 10 years 9.0% pa 15 years 1.1% from peak



Yields 0.0 percentage points over the quarter

0.1 percentage point over the year

Selling time 4 days over the quarter 2 days over the year

Vendor discounting 0.3 percentage points over the quarter 0.4 percentage point over the year



Quarterly value change 2.2% -3.9% 1.7% 1.6%

12 mth value change 3.0% -1.0% -0.7% -0.4%5 yr average annual value change 2.8% 1.0% 4.0% 3.5%










2013 2012







15/23

15

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

May-93 May-97 May-01 May-05 May-09 May-13

Standard variable mortgage rates 3 yr fixed mortgage rates Cash rate

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

D ec-82 Dec-85 Dec-88 Dec-91 Dec-94 Dec-97 Dec-00 D ec-03 Dec-06 Dec-09 Dec-12

Percentagec

hange

Quarterly change Annual change

Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15

End of year average 3.60% 3.00% 2.75% 2% - 3% 2.75% - 3.25% 2.5% - 3.5%

70

80

90

100

110

120

130

May-93 May-95 May-97 May-99 May-01 May-03 May-05 May-07 May-09 May-11 May-1

Consumer Sentiment Index Six month rolling average

Economic Overview

Consumer sentiment records a sharp fall in the FederalBudget aftermath

The monthly survey of Consumer Sentiment undertaken byWestpac and the Melbourne Institute shows that Australianconsumer sentiment remains delicately poised.

The Index measures views on consumers household financialsituation over the past and coming year, anticipated economicconditions over the coming year and five years and buyingconditions for major household items. When the Index is above100 points, consumers are more optimistic than pessimistic andwhen it sits below 100 points it indicates there is morepessimism than optimism.

As at May 2013, the Index was recorded at 97.6 points, fallingby -7.0 per cent over the moth to its lowest level since August2012.The Index has now fallen for two successive months and thedeclines have been broad-based across all components of theindex despite recent cuts to interest rates and a low rate of

unemployment.

Australias economy has continued to grow at an annual rateof more than 3 per cent throughout 2012

Gross Domestic Product (GDP) measures the final value of allgoods and services produced in an economy over a givenperiod. As such, GDP is an important indicator as it showswhether an economy is expanding or contracting.Over the December 2012 quarter, GDP results showed the

Australian economy continuing to grow, with an increase of 0.6per cent.On an annual basis, the Australian economy has grown by 3.1

percent to December 2012.Recent GDP forecasts from the RBA suggest that the Australianeconomy will grow at an annual rate of 2.75% in 2013 which isbelow recent levels.GDP data highlights that in recent times, consumers are savingmore with the national household savings ratio at 10.3 per centof household income, which remains close to the highest levelssince the mid 1980s.Over the 12 months to December 2012, disposable incomeshave increased by just 0.3 per cent, compared to growth of 4.5per cent at the same time in 2011.

Official interest rates are now at their lowest level in more

han 50 yearsThe average standard variable mortgage rate is currentlyrecorded at 6.2 per cent and the official cash rate is set at 2.75per cent.The average 3 year fixed mortgage rates were recorded at 5.45per cent in May 2013.Official interest rates have now been cut by 200 basis pointssince the RBA commenced their easing cycle in November2011. Australias banking sector has passed on around 160basis points worth of these cuts.Official interest rates have now reached their lowest ever pointhowever, standard variable mortgage rates are 45 basis points

higher than the fifty year low rates of April and May 2009.Despite the fact interest rates are at very low rates, manyeconomists anticipate further interest rate cuts through 2013 asthe mining investment boom peaks, inflation remains well withinthe target range and the economy grows at a below trend rate.

Australian consumer sentimentMay-93 to May-13

Source: rpdata, Westpac-Melbourne Institute

Percentage change in GDPDec-82 to Dec-12

Source: rpdata, ABS

RBA GDP growth forecastsDec-12 to Jun-15

Source: rpdata.com, RBA Statement on Monetary Policy May 2013

Standard variable mortgage rates vs.3 yr fixed mortgage rates

Source: rpdata, RBA


16/23

16

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

Mar-01 Mar-03 Mar-05 Mar-07 Mar-09 Mar-11 Mar-13

Changeinretailtrade

Monthly change Annual change

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

Mar-93 Mar-97 Mar-01 Mar-05 Mar-09 Mar-1

All groups Avg of trimmed mean and weighted median

RBA Target Range

-1.5%

-0.5%

0.6%

1.4%

1.5%

1.6%

2.5%

2.9%

3.7%

5.1%

5.8%

6.1%

-6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0%

Clothing and Footwear

Recreation and Culture

Furnishings, Household Equipment and Services

Transport

Communication

Food and Non-alcoholic Beverages

All Groups

Insurance and Financial Services

Alcohol and Tobacco

Housing

Education

Health

Economic Overview

Underlying and headline inflation readings are both at theower end of the RBAs target rangeThe Consumer Price Index (CPI), measures the level of priceinflation within the economy.Over the past year, the all groups indicator has increased by 2.5

percent which is in the middle of the RBAs long-term targetrange of 2 to 3 per cent.Although growth has been sturdy throughout the year over thepast two quarters, it has been much slower at just 0.6 per centor an annualised rate of 1.2 per cent.The RBAs preferred inflation indicators are the weightedmedian (2.6 per cent) and trimmed mean (2.2 per cent), both ofwhich are at around the lower to middle end of the RBAs targetrange.The level of inflation, particularly over the past two quarters,provides the RBA with scope to cut interest rates over thecoming months if it feels it necessary.The RBA expects that inflation will remain within the target

range over the coming years.

Growth in the cost of most goods and services is easingCPI measures the change in the price of a bundle of goods asdefined within the adjacent graph.Each item carries a certain weight with some items having agreater influence on the result, these include: housing (22.3 percent), food and non-alcoholic beverages (16.8 per cent),recreation and culture (12.6 percent) and transport (11.6 percent).Over the year to March 2013, CPI across all groups increased

by 2.5 per cent, with some items increasing more than others:health (6.1 per cent), education (5.8 per cent) and housing (5.1per cent) recorded the largest increases within the housingcomponent of CPI.Costs for clothing and footwear (-1.5 per cent), recreation andculture (-0.5 per cent) and furnishings, household equipmentand services (0.6 per cent) have either fallen or recorded only aslight increase over the year.

Retail trade starts the year with a bangOver the first quarter of 2013, retail trade increased by 2.2 per

cent, its largest quarterly increase since the three months toNovember 2009.Retail trade has increased by 3.2 per cent over the 12 months toMarch 2013.Overall, growth in retail trade is still at low levels compared topre-GFC periods. The slowing of retail trade is reflective of thecautious consumer mindset, which is supported by low levels oflending and soft housing finance, not to mention the high levelsof savings by households.Food retailing has recorded the greatest uplift in trade over theyear (5.6 per cent) followed by cafes, restaurants and take-awayfood services (3.8 per cent) and household goods retailing (2.3

per cent).Retail trade for clothing, footwear and personal accessoryretailing has fallen by -1.4 per cent over the year whilst growth inother retailing (0.1 per cent) and department stores (1.5 percent) has been relatively subdued.

Consumer Price Index (CPI)Mar-93 to Mar-13

Source: rpdata, ABS, RBA

Annual change in components of CPIYear to March 2013

Source: rpdata, ABS

Annual change in retail tradeMar-01 to Mar-13

Source: rpdata, ABS


17/23

17

2%

4%

6%

8%

10%

12%

Apr-86 Apr-89 Apr-92 Apr-95 Apr-98 Apr-01 Apr-04 Apr-07 Apr-10 Apr-13

UnemploymentRate

Unemployment Rate

Moving annual average

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0%

NT

ACT

WA

NSW

QLD

SA

VIC

TAS

Unemployment rate (%)

$0.40

$0.50

$0.60

$0.70

$0.80

$0.90

$1.00

$1.10

$1.20

Apr-83 Apr-88 Apr-93 Apr-98 Apr-03 Apr-08 Apr-13

Exchangerate($Ato$US)

Economic Overview

Australian dollar remains above parity with the US dollarThe $A broke through parity with the $US in December 2010,and has largely remained above parity ever since.

As at April 2013, $1A would buy you almost $1.03US.The $A also remained high against other major currenciesincluding: the Euro ($1A = 0.79 Euros compared with 0.50 Euroin 2009), the Pound ($1A = 0.67GBP compared with 0.45GBPin 2009) and the Japanese yen ($1A = 101.39Y compared with62.6Y in late 2009.The strong performance of the $A is great news for thoseimporting from overseas however, it is a significantdisadvantage for exporters, particularly manufacturing and thetourism sector.Over more recent weeks we have seen the Australian dollar slipback below parity with the US dollar and fall relative to anumber of other major currencies.

The unemployment rate remains in check although it hasrended higher over recent monthsIn April 2013, the national unemployment rate was recorded at5.5 per cent, which was down from 5.6 per cent the previousmonth and higher than the 5.0 per cent a year ago.Over the past 12 months, total employment has increased by1.4 per cent which is higher than the annual growth rate of 1.1per cent at the same time the previous year.The number of unemployed persons has increased by 14.0 percent in April 2013 compared to the same time in 2012.

Full-time employment has increased by 1.2 per cent over theyear while part-time employment has risen by a greater 2.0 percent.

As at April 2013, the employment participation was recorded at65.3 per cent compared to 65.2 per cent at the same time ayear ago.

Unemployment rate remains below 6 percent in every stateexcept Tasmania

Every state, besides Tasmania currently has an unemploymentrate recorded below 6.0 per cent.In April 2013, the lowest unemployment rates were recorded inthe Northern Territory (4.5 per cent), the Australian CapitalTerritory (4.6 per cent) and Western Australia (5.2 per cent).Tasmania has the nations highest unemployment rate of 7.5per cent, followed by Victoria (5.8 per cent), South Australia(5.7 per cent) and Queensland (5.6 per cent).Each state and territory except for Tasmania has anunemployment rate which is higher in April 2013 than it was in

April 2012.The Northern Territory recorded the highest employment

participation rate at 73.0 per cent, followed by the AustralianCapital Territory at 72.4 per cent.Tasmania (59.9 per cent), South Australia (63.3 per cent) andNew South Wales (64.2 per cent) have the lowest employmentparticipation rates nationally.

$A exchange rate to $USApr-83 to Apr-13

Source: rpdata, RBA

Unemployment Rate Seasonally adjustedApr-86 to Apr-13

Source: rpdata, ABS

Unemployment Rate by StateApril 2013

Source: rpdata.com, ABS


18/23

18

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

Sep-84 Sep-88 Sep-92 Sep-96 Sep-00 Sep-04 Sep-08 Sep-12

Quarterlychange

inpopulation

Natural Increase Net Overseas Migration

0.0

20.0

40.0

60.0

80.0

100.0

120.0

Apr-83 Apr-86 Apr-89 Apr-92 Apr-95 Apr-98 Apr-01 Apr-04 Apr-07 Apr-10 Apr-13

Commoditypriceindex

(SDR)

538

4,192

7,389

16,383

81,694

86,033

91,389

94,837

0 20,000 40,000 60,000 80,000 100,000

Tasmania

Nothern Territory

Australian Capital Territory

South Australia

Western Australia

New South Wales

Queensland

Victoria

Economic Overview

Commodity prices continue to head lowerCommodity prices, incorporating rural, non-rural and basemetals, all recorded a big slump during the GFC.Commodity prices recorded a recent low in mid 2009 however,prices have rebounded strongly since then. After returning to a

historic high, commodity prices began to fall again in July 2011.Commodity prices have fallen by -17.4 per cent since peaking inJuly 2011.Much of the recent decrease in commodity prices is due to fallsin the market price of coking coal and thermal coal.Base metals prices have fallen by -11.6 per cent since theymost recently peaked in February 2011 however, they remain-41.8 per cent lower than their historic high in June 2007.

Although the demand for Australian resources is likely to remainstrong, it appears that prices and demand have peaked and asa result commodity prices may ease further over the comingmonths.

Population growth is continuing to increase due to anncrease in overseas migrationOver the year to December 2008, population growth peaked at409,000 persons and began to decline during the post-GFCperiod of 2009.Australias population grew by more than 382,000 persons overthe year to September 2012, indicating that the rate ofpopulation growth is once again accelerating.The increase in population growth is largely being driven by an

increase in net overseas migration.Over the last year net migration has contributed an additional228,000 persons to the Australian population, a 32.2 per centincrease from the same time the previous year.The more up-to-date overseas arrivals and departures datashows that net long-term arrivals have continued to trend higherrecently.The rate of natural increase has increased by 4.0 percent sinceSeptember 2011.

Victoria is recording the greatest raw number population

ncrease while Western Australia is the fastest growing stateAnnually, Victoria has recorded the greatest population increaseover the 12 months to September 2012.In terms of raw number population growth, the population ofVictoria grew by almost 95,000 persons over the year, morethan the 91,000 person increase in Queensland, 86,000 personincrease in New South Wales and 82,000 person increase inWestern Australia.The major cities like Melbourne, Sydney, Brisbane and Perthare recording the greatest population growth. As a result,additional housing and demand for essential services continuesto grow at a faster pace in these cities.In percentage terms, Western Australia is recording the fastest

population growth rate at 3.4 percent, followed by 2.0 percentgrowth in Queensland and the Australian Capital Territory.Nationally, the population has grown by 1.7 percent over thelast year, compared to 1.2 percent annual growth at the sametime over the previous year.

Quarterly population growthSep-84 to Sep-12

Annual population growth by stateYear to September 2012

Source: rpdata, ABS

Source: rpdata, ABS

Commodity price indexApr-83 to Apr-13

Source: rpdata, RBA


19/23

19

0

20,000

40,000

60,000

80,000

100,000

120,000


Total quarterly dwelling approvals Quarterly change in population growth

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000


Private house approvals (rolling 6 mth avg) Private unit approvals (rolling 6 mth avg)

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%


%

ofFirstHomeBuyerHomeLoans

New housing supply continues to trend lowerOver recent years Australias population has continued toincrease however, dwelling approvals have failed to keeppace with this growth.Dwelling approvals still have not returned to the recent peak

in activity recorded in 2002/2003.Total dwelling approvals in March 2013 were 3.9 per centhigher than they were in March 2012 however, private sectorhouse approvals were -0.6 per cent lower while the morevolatile unit approvals were 12.3 per cent higher.Over recent months approvals have trended higher however,this trend was not sustained in March with approvals falling -5.5 per cent over the month.Over the 12 months to March 2013, the proportion of unitapprovals was at a record high, accounting for 41.8 per centof all dwelling approvals.

The imbalance between housing demand and supplypersistsThe supply and demand imbalance is an issue that has beenhighlighted by government departments, as well as privateinstitutions.It is likely that the housing shortage will continue to worsen aspopulation growth has once again ramped up and therequired dwelling approval targets are consistently not beingmet.Population growth has increased substantially over recent

years however, the number of new dwelling approvals hasbeen unable to keep pace with the ramp up in populationgrowth.Net overseas migration has continued to climb over recenttimes and it is well above long-term averages resulting in anincreased demand for housing across the country.

First home buyers represent only a small proportion ofbuyer demand

First home buyer activity has weakened noticeably overrecent years after they peaked in May 2009, accounting for

31.4 percent of all owner occupier finance commitments.In March 2013, 14.2 per cent of owner occupier housingfinance commitments were accounted by first home buyers,which was the lowest proportion since May 2004.While the percentage of first home buyer activity (against allowner occupier finance commitments) fell by -1.4 per centover the month, the actual volume of first home buyercommitments has increased by 11.4 per cent over the sameperiod.Year on year, the number of finance commitments to firsthome buyers has fallen by -16.4 per cent.

Across the individual states, significant declines in first homebuyer activity have been experienced in New South Wales (-

40.3 per cent year on year) and Queensland (-48.9 per centyear on year).The proportion of first home buyers is highest in Western

Australia (23.4 per cent), the Australian Capital Territory (18.8per cent) and South Australia (17.8 per cent).

Dwelling approvals houses vs. units (private sector)Mar-85 to Mar-13


Dwelling approvals vs. population growthMar-85 to Mar-13

First home buyer finance commitmentsProportion of FHB commitments vs. total owner occupier commitments

Source: rpdata, ABS


Housing Data


20/23

20

0

10,000

20,000

30,000

40,000

50,000

Mar-93 Mar-95 Mar-97 Mar-99 Mar-01 Mar-03 Mar-05 Mar-07 Mar-09 Mar-11 Mar-1

F

inancecommitments

Refinances Total excluding refinances

3.5

4.0

4.5

5.0

5.5

6.0

6.57.0

7.5

8.0

8.5

9.0

9.5

Mar-03 Mar-05 Mar-07 Mar-09 Mar-11 Mar-13

ValueofCommitm

ents($billion)

Investment 3 month average

Housing Data

2.6%

2.8%

2.8%

3.5%

3.9%

5.1%

5.8%

13.5%

16.8%

17.1%

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0%

Water and Sewerage

New Dwelling Purchase by Owner Occupiers

Maintenance and Repair of the Dwelling

Rents

Other Housing

Housing

Property Rates and Charges

Utilities

Gas and Other Household Fuels

Electricity

nvestor activity has ramped up sharply over the past yearWith values once again starting to increase and capital cityrental yields much greater than returns on money in the bank,there has been a significant increase in investor activity over thepast year.Over the year to March 2013, the total value of investor financecommitments increased by 21.3 per cent which was the greatestyear on year increase since November 2007 (25.6 per cent).35.2 per cent of the value of all finance commitments in March2013, have been accounted for by investors, which representsan approximate value of $8.1 billion, the greatest monthly valueof investor activity since July 2007.

New loans to owner occupiers are starting to trend higherrom their recent low baseIn March 2013, total owner occupier loan commitmentsincreased by 5.2 per cent over the month and they have risen by6.3 per cent compared to volumes in March 2012Over the year, increases have been recorded across each of thedifferent categories: construction of new dwellings (7.4 per cent),purchase of new dwellings (56.7 per cent) and purchase ofestablished dwellings (3.6 per cent).It is also important to look at how many of these commitmentsare from refinances of existing loans as opposed to new loancommitments.

New loan commitments are 13.8 per cent higher than a year agowhile refinance commitments have fallen by -7.2 per cent.It is somewhat surprising to see refinance commitments fallingespecially when you consider the current competitive home loanmarket.

Electricity, gas and utilities cost rises adding to the cost ofowning and running a home

Each component of CPI is broken down into sub categorieswhich influence the overall performance. Housing costscomprise the largest weighting in the CPI calculation.Over the year to March 2013, housing costs have increased by

5.1 per cent which is well above the 2.5 per cent increase in CPIover the same period.

All housing sub categories have experienced annual increases,with the largest changes occurring in: electricity (17.1 per cent),gas and other household fuels (16.8 per cent), utilities (13.5 percent) and property rates and charges (5.8 per cent).

According to CPI data, rents are gradually increasing, up 3.5percent over the year.Over the past ten years, electricity costs increased at thehighest average annual rate at 8.3 per cent, followed by utilitiesincreasing by 8.0 per cent annually and water and sewerage at7.6 per cent annually.

On the other hand, dwelling maintenance and repairs haveincreased at an average annual rate of 2.6 per cent and costsassociated with new dwelling purchases by owner occupiersincreased by 3.5 per cent annually over the same period.

Total value of investment finance commitmentsMar-03 to Mar-13

Owner occupier refinance vs. non-refinance commitmentsMar-93 to Mar-13

Source: rpdata, ABS

Source: rpdata, ABS

Annual change in Housing CPI sub categoriesYear to March 2013

Source: rpdata, ABS


21/23

21

RP Data Leading Indicators

Mortgage activity has trended higher throughout 2013oreshadowing a further lift in housing finance commitmentsrpdata facilitates more than 100,000 mortgage activity eventsevery month across our finance industry platforms. Monitoringthe activity events across these platforms provides a unique andtimely lead indicator to housing finance commitments. The indexshows an 81% correlation with the ABS housing finance dataseries (88% using the seasonally adjusted series). Based onthe strong correlation and significant number of events beingmonitored, the rpdata Mortgage Index (RMI) provides the mosttimely and holistic measure of mortgage market activityavailable.

As you can see from the adjacent chart, mortgage activity iscurrently at its highest levels since late 2009 which indicates wecan expect a higher number of housing finance commitmentsover the coming months as data is released by the ABS.

The rpdata Listings Index (RLI) is starting to move lowerndicative of a lower number of new properties being

prepared for saleThe rpdata Listings Index provides a lead indicator for thenumber of residential dwellings that are being prepared for saleacross the Australian housing market. rpdata customersaccount for over 70% of all listings in the Australian propertymarket. The index, which tracks the flow of metadata acrossrpdatas real estate data platforms, shows a 75% correlation

with the number of new listings about to enter the market.The RLI indicates that the recent decline in the number of newproperties available for sale is set to continue over the comingweeks.

RP Data Mortgage Index (RMI)May-09 to May-13

RP Data Listings Index (RLI)Mar-93 to Mar-13

Source: rpdata

Source: rpdata

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RP Data Mortgage Index RP Data Mortgage Index (seas adj)

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About rpdata

Established in 1991, RP Data is the leading supplier of commercial and residential property information services throughoutAustralia and New Zealand. Subscription clients to RP Datas property information service include over 10,000 real estate

agents, valuers, property developers, financial institutions and government departments. RP Data is also the largest supplier

of electronic valuations and consumer property reports in Australia generating over 30 million electronic valuations everymonth.

Our recent acquisitions of the Valex Group (made up of Valuation Exchange and Megaw & Hogg National Valuers) andSandstones VMS division has allowed us to expand this role further. By combining our leading databases and analytics withexisting property valuation management processes, platforms and a leading valuation firm, were able to develop more

efficient valuation solutions while reducing the risks associated with mortgage lending.

The name RP Data is synonymous with the property and commercial markets. We have forged a strong reputation asleaders in the provision of comprehensive real-time data that has proven to cut costs, increase productivity and deliver areal and rapid return on investment.

Used by thousands of corporations and consumers seeking property information, RP Data is proud to boast the Reserve

Bank of Australia as one of our key customers along with many multi-national corporations, financial institutions, real estateprofessionals, developers, investors and more recently, the broader consumer market through our user-friendly consumerbrandmyrpdata.com

Through our five-star property information services, we are able to ensure that the quality of our data and extendedinformation services give our customers the confidence to make sound and well researched decisions about property.

As the pioneers of online property information, we are at the forefront of innovation through continual investment in emergingstate-of-the-art technologies which are user-friendly and cost-effective for customers at all levels.

Our key value to our clients lies in the delivery of vast and accurate property information and analytics. Whether our clientsneed to increase listings to sell more, manage their risk portfolio effectively, market to current and future clients who are

transacting in property, or simply streamline the way they do business, RP Data has the solution.

I t 's n ot ju st d ata, it 's RP Data.
http://www.myrpdata.com/http://www.myrpdata.com/


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Disclaimers

2013 Copyright RP Data Ltd, Local, State, and Commonwealth Governments. All rights reserved. No reproduction,distribution or transmission of the copyrighted materials in this publication is permitted whether in whole or in part.

The information provided in this publication is current as at the publication date only. This publication is supplied on thebasis that while rpdata.com believes all the information in it is deemed reliable at the publication date, it does not warrant its

accuracy or completeness and to the full extent allowed by law excludes liability in contract, tort or otherwise, for any loss ordamage sustained by yourself, or by any other person or body corporate arising from or in connection with the supply oruse of the whole or any part of the information in this publication through any cause whatsoever and limits any liability itmay have to the amount paid to rpdata.com for the supply of such information.

This publication provides general information only it is not intended as advice and should not be relied upon as such. Thematerial has not been prepared by taking into account your investment objectives, financial situation or personal needs.You should make your own inquiries and if necessary take independent financial advice tailored to your specificcircumstances before making any investment decisions.

Queensland Data The State of Queensland (Department of Environment and Resource Management) 2012. Based on data provided with

the permission of the Department of Natural Resources and Mines: [QVAS 2012)]. The Department of Environment andResource Management makes no representations or warranties about accuracy, reliability, completeness or suitability ofthe data for any particular purpose and disclaims all responsibility and all liability (including without limitation, liabili ty innegligence) for all expenses, losses and damages (including indirect or consequential damage) and costs which might beincurred as a result of the data being inaccurate or incomplete in any way and for any reason.

South Australian DataThis information is based on data supplied by the South Australian Government and is published by permission. The South

Australian Government does not accept any responsibility for the accuracy or completeness of the published information orsuitability for any purpose of the published information or the underlying data.

New South Wales DataContains property sales information provided under licence from the Land and Property Information (LPI). RP Data is

authorised as a Property Sales Information provider by the LPI.

Victorian DataTo the extent that this report has been developed using information owned by the State of Victoria, the State of Victoriaowns the copyright in the Property Sales Data which constitutes the basis of this report and reproduction of that data in anyway without the consent of the State of Victoria will constitute a breach of the Copyright Act 1968 (Cth). The State ofVictoria does not warrant the accuracy or completeness of the information contained in this report and any person using orrelying upon such information does so on the basis that the State of Victoria accepts no responsibility or liability whatsoeverfor any errors, faults, defects or omissions in the information supplied.

Western Australian DataBased on information provided by and with the permission of the Western Australian Land Information Authority (2012)

trading as Landgate.

Australian Capital Territory DataThe Territory Data is the property of the Australian Capital Territory. No part of it may in any form or by any means(electronic, mechanical, microcopying, photocopying, recording or otherwise) be reproduced, stored in a retrieval system ortransmitted without prior written permission. Enquiries should be directed to: Director, Customer Services ACT Planningand Land Authority GPO Box 1908 Canberra ACT 2601.

Tasmanian DataThis product incorporates data that is copyright owned by the Crown in Right of Tasmania. The data has been used in theproduct with the permission of the Crown in Right of Tasmania. The Crown in Right of Tasmania and its employees andagents:

a) give no warranty regarding the data's accuracy, completeness, currency or suitability for any particular purpose; andb) do not accept liability howsoever arising, including but not limited to negligence for any loss resulting from the use of orreliance upon the data.

Base data from the LIST State of Tasmania http://www.thelist.tas.gov.au

Documents

RP Data Quarterly Review May 2013