October Real Estate Report

National Housing Market Investors Report
Housing Market Revival Strengthens - Nearly Everywhere
Dr Andrew Wilson -Chief Economist at Wealthi
October 2020

Disclaimer
In compiling this publication, the Publisher relies upon information supplied by a number of
external sources. The publication is supplied on the basis that, while the Publisher believes
all the information in it will be correct at the time of publication, it does not warrant its
accuracy or completeness and to the full extent allowed by law excludes liability in contract,
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may have to the amount paid to the Publisher for the supply of such information. The data
and projections should be used as a guide only and should not be relied upon in making
investment decisions.

Dr Andrew Wilson
Chief Economist
Current State of the Markets
The spring selling season has commenced in earnest with confirmation
over September that most capital city housing markets are now on the
road to recovery.
The autumn coronavirus shutdown placed property markets on hold,
however buyer and seller activity bounced back over winter and is now set to
build upward momentum through to years end.
The national economy has also improved over recent months despite its
official recession status with unemployment rates falling, job numbers
rising and a sharp return to the workforce from previously discouraged
workers.
Recent home lending data also reveals a housing market revival with
lending now rising sharply over consecutive months with all buyer groups
active - particularly owner-occupiers and first home buyers. Home
building loans have soared to 11-year highs.
Federal government initiatives designed to ease the questionable home
lending restrictions of recent years by banks will fuel rising confidence
and activity in housing markets.
The Federal Budget has announced more stimulus to the economy to
offset the winding back of Jobkeeper allowances, with business tax
concessions and the immediate implementation of broad-based tax cuts
for most PAYE taxpayers.
First Home Buyers, the building industry and the economy in general will
be clear winners from the Federal Governments Budget decision to
extend the popular First Home Buyers Deposit Scheme which will
continue to tap into pent-up demand from that group, reflecting
Australian’s strong underlying aspiration for home ownership.
Although housing markets and economies have an improving outlook for
spring, the Victorian economy and the Melbourne housing market each
remain in the doldrums as a result of the continued severe local
shutdown policies in force. The experience of other states and capital
cites however remains a beacon of optimism for the state that growth
and activity can resume as soon as local lockdown conditions are eased.
The recent surge in Melbourne listings and sales, albeit from a low base,

Dr Andrew Wilson
Chief Economist
following an easing of restrictions, is a positive sign for the revival
prospects of the local market.
Naturally, the outlook for housing markets and the economy generally is
dependent on the continued control of coronavirus, with maintaining
open local communities and state border re-openings a key determinant.
Home building activity has increased sharply in recent m onths -
particularly for houses, indicating the ongoing impact of the
governments popular HomeBuilder Grant. Apartment development
however remains subdued and well behind the levels of previous years
reflecting policies restricting investor and developer finance, and barriers
to international developers.
Rental markets continue to produce mixed results with vacancy rates for
apartments generally easing although tightening for houses and perhaps
indicating rising demand for larger dwellings in the new work-from-home
environment.
Record level unit vacancies in inner-city Sydney and CBD Melbourne
reflect a surge in the supply of apartments previously directed to
holiday-accommodation but transferred to the permanent tenant market
as tourist and foreign student demand has collapsed due to closed state
and international borders.
Reflecting high vacancy rates, unit rents in inner-city Sydney and CBD
Melbourne are now falling, although house rents generally remain steady
in most capitals.
Housing markets are set to build on a generally positive start to the
spring selling season with buyer and seller activity likely to increase over
coming months until the holiday shutdown.
Most capital cities are on track to record a rise in house and unit prices
over 2020 and although Melbourne is the clear exception, the prospect
of sharp price declines in that city are now diminishing with recent
positive signs of re-emerging activity.
Record low interest rates are a key ongoing driver of housing markets
with rising speculation of a near-term cut in the official rate which, if
eventuates, and passed on by banks, will increase housing affordability
and provide financial relief to mortgage holders.
Although the economic outlook remains fragile, consumer and business
confidence are rising as shutdown restrictions ease, with the Australian
economy increasingly better positioned than most to ride out the
coronavirus storm. Australian housing markets are also once again
proving their resilience.

The Economy
ABS National Jobless Seasonal Adjusted
8%
7%
6.8%
6%
5%
4%
3%
2015 2016 2017 2018 2019 2020
The monthly national unemployment rate fell sharply from 7.5%
to 6.8% over August.
ABS National Jobs and Workforce Change 2020
Returned to Workforce
457,984 457,426
Found Jobs
298,482
227,822
119,153
134,456
111,008
24,488
June July August Total
Jobs increasing and participation rate rising since end of autumn shutdown –
NSW, QLD and WA the best performers.

ABS August 2020 Jobless Rate
7.8%
6.8%
7.5%
7.0%
7.3%
5.2%
5.4%
4.3%
Sydney Melbourne Brisbane Adelaide Perth Hobart Darwin Canberra
Smaller capitals best performers with lowest unemployment rates.
ABS National Retail Turnover Seasonally Adjusted
$32b
$30b
$29.5b
$28b
$26b
$24b
$22b
$20b
Jan-2019
Feb-2019
Mar-2019
Apr-2019
May-2019
Jun-2019
Jul-2019
Aug-2019
Sep-2019
Oct-2019
Nov-2019
Dec-2019
Jan-2020
Feb-2020
Mar-2020
Apr-2020
May-2020
Jun-2020
Jul-2020
Aug-2020
Retail sales still strong despite monthly easing and remain
higher than pre-coronavirus levels.

ABS Retail Turnover Seasonally Adjusted Monthly Change August 2020
-2.0%
-1.1% -0.9%
-0.4%
-4.0%
-12.6%
NSW VIC QLD SA
WA
NAT
Sharp monthly decline in Victorian retail turnover a significant contributor to
national monthly decline.
AUD v USD Daily Close
80
75
70
70.2c
71.78
65
57.43.c
60
55
50
02/09/19 25/11/19 17/02/20 11/05/20 03/08/20
AUD recovering after interest rate cut speculation and
positive response to Federal Budget.

All Orders Daily Close
8000
7000
7,237
6,313
6000
4,564
5000
4000
3000
2000
1000
0
09/12/19 23/10/20 06/03/20 21/04/20 02/06/20 15/07/20 26/08/20 07/10/20
Positive response from a steady sharemarket to Federal Budget.
Housing Markets
National Newly Listed Homes Daily Index
(Base 100 = Mar 1 2020)
100
95.63
1/3/20 1/4/10 1/5/20 1/6/20 1/7/20 1/8/20 1/9/20 1/10/20
Newly listed houses for sale on the rise reflects increased seller confidence in market
conditions and the revival of Melbourne listings.

National Newly Listed Homes Daily Index Annual Change
30%
20%
10%
4.46%
0%
-10%
-20%
-30%
-40%
National newly listed homes for sale now tracking higher than at
the same time last year.
Monthly Change in Newly Listed Homes September 2020
19.4%
8.2%
3.7%
1.0%
1.5%
Sydney Melbourne Brisbane Adelaide
Perth
New listings continue to rise with a recent surge in Melbourne as shutdown
restrictions to housing market activity ease.

Monthly New Listings Relativity Index September 2020
Base = Sydney 100
100
60.9
63.4
52.1
27.9
Sydney Melbourne Brisbane Adelaide
Perth
Sydney clearly with highest new monthly listing volumes over the month
compared to other capitals.
New Sales
Newly Reported Home Sales Monthly Change September 2020
12.2%
15.1%
13.6%
1.5%
-54.2%
Sydney Melbourne Brisbane Adelaide
Perth
Newly reported home sales rising in most capitals over the month with Brisbane
still leading performer - Melbourne however down sharply although recovering
modestly towards months end.

Newly Reported Sales Relativity Index September 2020
Base = Sydney 100
100
60.9
63.4
52.1
27.9
Sydney Melbourne Brisbane Adelaide Perth
Sydney clearly top performer in newly reported sales volumes over September.
Asking Prices, Rents and Gross Yields
Capital City Daily Median Asking Prices and Rents
House
Unit
Capital
Price
Rent
Yield
Price
Rent
Yield
Sydney
$1,104,234
$530
2.50%
$584,599
$480
4.27%
Melbourne
$835,335
$450
2.80%
$461,008
$400
4.51%
Brisbane
$579,034
$400
3.59%
$358,270
$415
6.02%
Adelaide
$541,309
$420
4.03%
$285,438
$365
6.65%
Perth
$530,465
$400
3.92%
$334,966
$375
5.82%
Hobart
$568,748
$490
4.48%
$433,739
$420
5.04%
Darwin
$584,722
$520
4.62%
$311,770
$375
6.25%
Canberra
$728,517
$570
4.07%
$391,184
$495
6.58%
End-of-month daily asking prices, rents and gross yields September 2020.

National 10 Top LGA Gross Yields (min 20 for sale and 20 for rent)
House
State LGA Median Price Listed Median Rent Listed Yield
NSW Broken Hill $172,500 180 $290 26 8.74%
SA Whyalla $220,000 278 $300 29 7.09%
WA Coolgardie $139,500 52 $170 49 6.34%
WA Kalgoorlie/Boulder $319,000 302 $380 56 6.19%
NSW Muswellbrook $320,000 158 $380 37 6.18%
QLD Mount Isa $380,000 85 $450 22 6.16%
NT Alice Springs $480,000 147 $565 30 6.12%
WA Broome $499,500 86 $570 20 5.93%
NSW Western Plains Regional $298,500 255 $340 34 5.92%
SA Port Augusta $245,000 237 $260 28 5.52%
National 10 Top LGA Gross Yields (min 20 for sale and 20 for rent)
House
State LGA Median Price Listed Median Rent Listed Yield
QLD Cairns $249,000 803 $350 340 7.31%
QLD Ipswich $200,000 108 $270 66 7.02%
NT Palmerston $270,000 42 $345 28 6.64%
QLD Logan $231,000 113 $295 102 6.64%
NSW Tamworth Regional $235,000 26 $290 26 6.64%
QLD Central Highlands $229,000 32 $290 28 6.59%
QLD Townesville $262,750 374 $330 123 6.53%
WA Kalgoorlie/Boulder $239,000 35 $300 21 6.53%
SA Port Adelaide Enfield $240,000 67 $298 48 6.45%

Capital City Daily Median Asking Prices and Rents
Capital
Houses
Units
Total Homes
Sydney
1.9%
5.3%
3.8%
Melbourne
2.2%
6.9%
4.1%
Brisbane
1.4%
3.3%
2.2%
Adelaide
0.7%
1.9%
1.0%
Perth
1.0%
1.8%
1.2%
Hobart
0.3%
1.4%
0.5%
Canberra
0.8%
1.1%
1.0%
Darwin
0.5%
2.0%
1.2%
Rental vacancy rates for houses significantly lower than for units in all
capitals with inner-city Sydney and CBD Melbourne at record levels.

Capital City Quarterly Median Price Index (September qrt)
Sydney
Melbourne
Brisbane
Adelaide
Perth
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Melbourne and Sydney quarterly house prices most significantly impacted by coronavirus shutdown policies.
Home Loans
ABS National Home Loan August 2020 Seasonally Adjusted
$16
$14
$12
First Home Buyers
Investors
Owner-Occupiers
$14.8b
$10
$8
$6
$4
$5.0b
$2
$0
2014 2015 2016 2017 2018 2019 2020
Home loans continue to rebound sharply – particularly
owner-occupiers and first home buyers.

ABS Home Loans Seasonal Adjusted Monthly Change August 2020
22.7%
13.9%
15.7%
13.6%
4.9%
NSW VIC QLD SA
WA
All states report strong increase in home lending over August.
ABS National Home Building Loans Seasonally Adjusted August 2020
5,000
4,679
4,500
4,000
3,500
3,000
2,500
2,000
Jan-2019
Feb-2019
Mar-2019
Apr-2019
May-2019
Jun-2019
Jul-2019
Aug-2019
Sep-2019
Oct-2019
Nov-2019
Dec-2019
Jan-2020
Feb-2020
Mar-2020
Apr-2020
May-2020
Jun-2020
Jul-2020
Aug-2020
Home building loans surge over August to 11 year monthly high.

ABS Owner-Occupier Home Building Loans August 2020
1514
843
1017
721
382
100
NSW VIC QLD SA
WA
TAS
Victoria records highest home building loans over August.
New Home Building
ABS Building Approvals Seasonally Adjusted August 2020
140,000
120,000
123,343
100,000
80,000
60,000
67,072
40,000
25,000
0
2012 2013 2014 2015 2016 2017 2018 2019 2020
Houses
Units
Apartment boom collapse reflects credit restrictions to local investors and increased levies on
international investors and developers.

ABS Building Approvals Total This Year to August v Same 2019
12.8%
17.4%
Houses
Units
2.5%
0.6%
5.0%
4.3%
-1.5%
-16.2%
-23.4%
-45.0%
Sydney Melbourne Brisbane Adelaide
Perth
Sydney, Adelaide and Perth unit approvals sharply lower this year, with Melbourne
higher but from a low base.
Market Barometer
R
I
S
I
N
G
Boom
Strong
Robust
Moderate
Modest
Houses
Darwin, Hobart, Canberra
Adalaide
Sydney
Perth
+6%
+4%
+3%
+2%
+1%
Units
Adalaide, Canberra
Brisbane
Sydney, Hobart
F
A
L
L
I
N
G
Flat
Modest
Moderate
Robust
Strong
0%
-1%
-2%
-3%
-4%
Perth
Melbourne, Darwin
Bust
Melbourne
-5%
Forecast Annual Mid-Range Median Prices Growth 2020.