PropertyBuzz, your daily dose of property news.
A dramatic dip in CBA’s home buying index, NSW introduces height and density bonuses for new developments that include affordable housing, and auction activity remains high for the last reporting week of 2023
Welcome to Property Buzz! Today is Tuesday, 19 December.
– The Commonwealth Bank of Australia’s Home Buying Index fell 4.6 per cent in November, likely due to the Reserve Bank of Australia’s final rate hike for the year.
– But despite high interest rates, CBA expects strong demand from Australia’s growing population to support home buying activity into 2024, although supply constraints may increase dwelling prices.
– The bank also reported that its household Spending Insights index rose by 1.8 per cent in November, but the bank noted that economic growth is moderating and household budgets are under pressure due to high inflation and rising interest rates.
– And in New South Wales, new updates to the State Environmental Planning Policy have come into effect, delivering rewards developers prepared to commit 15 per cent of the gross floor area of new builds to affordable housing.
– Developers can now access a 30 per cent floor space ratio bonus and additional height of up to 30 per cent, so long as they commit to making the necessary floor space available to a community housing provider for 15 years.
Following an announcement of the changes in June in 2023, and subsequent industry backlash over some elements of the proposal, the policy has been adjusted to allow for scalability; so that if the full 30 per cent bonus can’t be accessed due to site restrictions, the affordable housing requirement can be reduced, but not below 10 per cent.
– The policy changes have been largely welcomed by industry advocates, though concerns remain about the “stacking” of state and local government affordable housing requirements that may serve as a deterrent.
– And a total of 2,918 homes were auctioned across capital cities in the week ending 17 December, a 4.1 per cent drop from the previous week but still relatively high.
– Compared to the same period in 2022, there were 25 per cent more homes auctioned this year, indicating increased vendor activity. However, buyer enthusiasm has decreased, with the clearance rate dropping to 66.8 per cent.
– In Sydney, 958 homes were auctioned in the past week, a 10.6 per cent drop from the previous week but 21.6 per cent higher than the same time in 2022. Melbourne saw 1,401 homes auctioned, with a 66.9 per cent success rate. This was the last reporting week for the year, with CoreLogic set resume its tallies in late January or early February.
That’s all for today. See you again tomorrow, 20 December, for your daily dose of Property Buzz.