Property Buzz

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Sydney’s luxury rental growth revealed as the steepest in the world; the REIQ condemns recent rental reforms; and auctions hold steady.

Welcome to Property Buzz! I’m Sebastian Holloman.

Today is Tuesday, 28th May and Knight Frank’s Prime Global Cities Index saw Sydney lead in prime rent growth in 2023, with a 17.3 per cent increase that more than tripled the growth rate of runner-up Auckland. 

With the report defining luxury properties as those in the top 5 per cent of the market by value, Auckland and London followed Sydney with growth rates of 5.6 per cent each.

Ben Burston, chief economist at Knight Frank, attributed Sydney’s rental rise to strong internal migration trends and a lack of availability, despite a sluggish economy and pressure on disposable incomes.

Despite a global slowdown with 20 per cent of cities showing a drop in rent prices, Knight Frank expects rental growth to resume later in the year as a result of sustained demand in key global cities.

Over in Queensland, the Real Estate Institute of Queensland (REIQ) has warned that without last-minute amendments, recent rental reforms could have been catastrophic.

Despite these last-minute adjustments, REIQ CEO Antonia Mercorella stated that the bill leaves much to be desired in light of how carelessly the government and the opposition continue to treat tenancy laws.

The new bill introduces a maximum rental bond limit of four weeks’ rent, which the REIQ fears will cause administrative burdens due to the amount of refund requests that could come from tenants with higher bonds.

The REIQ did describe the introduction of mandatory continuing professional development (CPD) for real estate agents as a significant victory, stating that mandates would lift the standard of professionalism across Queensland’s industry.

And looking at the week in auctions, volumes last week were similar to the previous week, with 2,163 properties going under the hammer, up slightly from 2,146 the previous week according to Corelogic’s Property Market Indicator Summary.

The preliminary auction clearance rate was reported as 71.5 per cent, roughly the same as the previous week’s 71.1 per cent.

Melbourne had over 1,000 auctions for the fourth week in a row, with 1,025 homes hitting the block, while Sydney came in second with just under 750 properties up for auction.

Corelogic predicts auction volumes will rise in the coming weekend, with around 2,400 homes scheduled for auction. Whether the clearance rate will follow suit remains to be seen.

That’s Property Buzz for today.

See you again tomorrow, 29 May, for your daily dose of Property Buzz.

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