Just over a third of homes nationally selling for less than $400,000: Cameron Kusher
GUEST OBSERVER
With national home values continuing to rise, the proportion of homes selling at lower prices is continuing to fall, resulting in fewer housing options for those on lower incomes.
Over the 12 months to June 2016, 33.1 percent of all houses and 40.6 percent of all units sold, transacted at a price point below $400,000.
These proportions have fallen from 34.8 percent and 44.1 percent respectively at the same time a year earlier. The proportion of house sales under $400,000 nationally is at a record low while the proportion of unit sales is at close to an historic low.
Annual proportion of house and unit sales below $400,000, National
Turning the focus to the combined capital cities shows that less than 1 in 5 houses (19.1 percent) and less than 1 in 3 units (31.0 percent) sold over the year to June 2016 for less than $400,000. In June 2015, the proportion of sales at less than $400,000 was greater at 21.3 percent for houses and 31.9 percent for units.
Annual proportion of house and unit sales below $400,000, combined capital cities
Regional markets are characterised as having homes transacting at substantially lower prices than the capital cities. Across the combined regional markets, 54.6 percent of houses and 65.4 percent of units that sold over the 12 months to June 2016 sold for less than $400,000.
Whilst the proportion of sales under $400,000 was at a record low for houses and units, both houses and units were more than twice as likely to transact for less than $400,000 than they were across the combined capital cities.
Annual proportion of house and unit sales below $400,000, combined regional markets
The table included in the report shows the proportion of total home sales under $400,000 over the 12 months to June 2016 and 10 and 20 years earlier.
What the table highlights very clearly is that over the decade to June 2006 there was a substantial decline in home sales under $400,000 with the decline continuing over the following 10 years.
Hobart is the only city in which more house sales occurred for less than $400,000 than above the price point over the past year. For units, only Adelaide and Hobart had more sales below $400,000 than those above.
Annual proportion of house and unit sales below $400,000, individual capital cities
These figures highlight the decline in sales across more affordable price points, particularly across the capital city housing markets.
With values continuing to rise it is a fairly safe bet that there will continue to be a decline in the number of homes selling for less than $400,000.
Cameron Kusher is research analyst for CoreLogic. You can contact him here.