Nobel Finance Sydney – Money Matters Newsfeed

Property investors that are looking for good price growth need to buy in the inner city, a new report has found.

The latest property report by PRDnationwide found that seven out of the top ten New South Wales suburbs recording the most growth in sales activity are located within a 20 kilometre radius of Sydney CBD.

Oatlands, 23km north of Sydney, topped the list recording 160 per cent growth in property sales between 2009 and 2010.

Sylvania Waters came a close second recording 156.3 per cent growth in sales activity, with 41 houses sold over the year – up from 16 the year before.

“The areas experiencing the greatest growth in sales offer a high degree of amenity and are well serviced by transport corridors,” PRDnationwide managing director Jim Midgley said.

“The New South Wales suburbs experiencing the highest growth in sales activity are typically situated in areas with easy access to the Sydney CBD through major road networks or train lines,” he said.

“These areas have a propensity for strong price growth as demand increases for properties nestled along major transport corridors.”

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Australia’s property price growth is the fifth best in the world, according to a new report.

The latest Knight Frank Global House Price Index found house prices rose by 18.4 per cent in Australia throughout the year to June 2010.

Singapore enjoyed the best property price growth – with prices surging 37.0 per cent in the year to June.

Knight Frank national director of research Matt Whitby said Australia’s significant price growth was driven by a number of factors including 40 year low interest rates, first time buyer concessions, strong population growth and a lagging supply response.

“With interest rates likely to rise from current levels in 2011, the government incentives winding back and the supply response picking up (albeit modestly), we expect house prices to track sideways over the next six to nine months,” he said.

Rounding out the top five positions were China in second place, followed by Hong Kong and then Latvia.

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Australia’s housing market exhibits different fundamentals from those hurting overseas, and is unlikely to see a significant dive in property prices, according to Advantedge general manager of broker platforms Steve Weston.

“I do get a bit sceptical when you here experts, or supposed experts come in from overseas, and they are saying fundamentally because property prices fell in the US or Europe well they’ll have to fall in Australia,” he told Broker News TV, in an exclusive interview.

Weston argues the US exhibits a much higher unemployment rate than Australia – at close to 15% when compared on an “apples with apples” basis. It is also dominated predominantly by fixed rate home loans, in contrast to Australia’s variable rate fixation, giving the Reserve Bank a lever to use if the local economy does enter more challenging territory.

Weston adds that compared with the US, Australian lending standards are high. “If we look at the US in those few years leading up to the GFC, about 30% of their lending was credit impaired, and all of it was done on a non-recourse basis, which means if customers do get into hot water, they can simply hand their keys back and it’s the lender’s problem,” Weston said.

Local market fundamentals are also strong, Weston argues, with interest rates still at normal levels, unemployment very low, a continued strong migration intake, and a “floor” under housing prices due to lack of supply.”So when we are hearing from these overseas pundits that properties are overvalued, I’m just a little sceptical,” he said.

Tags: home values rise, interest rates, Real Estate, real estate bubble australia
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The population of Australia has increased by just under a tenth between 2004 and 2009, according to new statistics.

The Australian Bureau of Statistics (ABS) has revealed that the estimated resident population in Australia at the end of June 2009 was 21.96 million – an increase of 1.83 million since June 2004. That equals a total population growth of 9.1%, and a yearly average of 1.8%. Should population growth continue at this rate, Australia would have a total population of 23.93 million in 2014 and 26 million by 2019.

The ABS figures also revealed that just under one-third of the country’s population lived in NSW as of last June, with the Northern Territory and ACT containing the fewest people. In terms of population growth, Queensland saw both the largest and fastest growth. There were also around 92,000 more women than men in Australia last June.

Tags: Real Estate, real estate bubble australia
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Self-managed super funds (SMSFs) are increasingly

investing in property, according to new figures. SMSF administrator Multiport has revealed that, out of the $1.lbn invested in funds it administers, 17% was allocated to property either directly or through trusts and funds as of 30 June.

This brings SMSF property investment levels to their highest level since December 2008. Multiport CEO John Mcllroy attributed the increase to the better performance of listed property trusts. The figures also revealed that SMSF asset allocation is still dominated by investment in shares, with Australian shares taking up 40% of SMSF assets (down from 42.6% in March). Cash and short-term deposit holdings accounted for 21.4% of SMSF assets.

Tags: Real Estate, SMSF
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