Top 5: Finance & property quotes week commencing November 3

By the resi financial blog team, 10 November 2014

Top 5: Finance & property quotes week commencing November 3

The week starting November 3 was a mixed bag from market commentators, but overall sentiment seems to be that there is growth in housing and construction, although tending towards more moderate increases, and financial markets continue to remain accommodative.

#1. Commenting on the Australian Industry Group/Housing Industry Association Australian Performance of Construction Index in a November 7 statement, HIA Chief Economist, Harley Dale, said:

"While the rate of expansion in the Australian PCI® slowed in October 2014, this latest update is still a healthy one for Australia's construction industry. Three of the four construction sectors – engineering being the predictable exception – registered expansionary readings. With a general economic discourse seemingly focussed on negative news, recent PCI results remain a breath of fresh air. It seems the case, however, that the activity and new orders indices for both detached houses and apartments are consistent with the maintenance of elevated levels of residential building approvals, rather than further growth."

#2. Earlier in the week, HIA Senior Economist Shane Garrett noted declining new build approvals, calling for policy changes to increase the supply of new housing.

"Unfortunately, today's data show that we are again moving in the wrong direction in terms of new housing volumes. We need a more imaginative approach from policymakers, particularly around land supply and the delivery of housing infrastructure."

#3. In a November 3 statement, RP Data Research Director Tim Lawless commented on the capital gains experienced by the country as expressed by the RP Data CoreLogic Home Value Index.

"Looking at the increase in home values over the 12 months to October, it is clear that the rate of capital growth is continuing to moderate. Despite the annual rate of value growth slowing, all capital cities have still recorded an increase in home values over the past year. Home values across the combined capital cities have increased by 8.9 per cent over the twelve months ending October '14, which has slowed from a peak of 11.5 per cent in April of this year."

#4. Glenn Stevens, Governor of the Reserve Bank of Australia, made the following statement on November 4 when discussing the steady cash rate decision:

"Volatility in some financial markets has picked up over the past couple of months. Overall, however, financial conditions remain very accommodative. Long-term interest rates and risk spreads remain very low. Markets still appear to be attaching a low probability to any rise in global interest rates or other adverse event over the period ahead"

#5. The SQM Research Stock on Market survey revealed some interesting market data. Louis Christopher, Managing Director of SQM Research made the following comment:

"The month recorded a rather large surge in listings, which were expected, given the slow start to the spring selling season. So at this stage we are not reading much into the results. However we note the rather large year on year result for Perth and Darwin, which is consistent with our previous warnings that these markets are in a downturn. Despite the listings surge in Sydney, our information is telling us that the market remains very strong for now."

Categories: Financial Services, Home Loans