With national dwelling values continuing to decline throughout 2018 and well into 2019, resulting in lower market confidence and fewer homes transacting, it’s important to understand the impact of this not only from the perspective of buyers and vendors but all industry participants. Given this, this week’s Pulse looks at the total value of sales in the current market. As fewer homes sell and transactional values go down; this is resulting in reduced total commission for agents and fewer mortgages across certain regions. This analysis highlights the total value of sales over the 12 months ending February 2019 compared to the same 12 month period in 2018. Providing a top 5 suburb list across each of the states where the total value of sales is the highest; the largest declines in total sales values and what suburbs have actually seen the greatest increase in the value of sales.
Across NSW, suburbs in the capital city region of Sydney have seen the largest transactional value declines with St Leonards topping this list with a significantly lower number of sales year on year resulting in a -78.4% reduction in sales value. While the prestigious suburb of Mosman has the greatest total transaction values with $1.3bn worth of sales over the year to February 2019, this is substantially lower than the same period last year when $1.7bn worth of homes transacted. To put this into perspective, if the average commission is approx. 1.5%- 3.0%, this would be a shared loss of commission of up to $1m for agents in just this suburb. While Sydney suburbs have recorded quite a decline in the value of sales, regional NSW has a number of suburbs where the total value of sales has doubled over the year.
Similar to NSW, Victoria’s capital city region is reporting the greatest declines in the total value of sales, while regional parts of the state have seen the greatest increases. Melbourne’s Campbellfield has seen the greatest decline in the value of sales year-on-year, down -56.2%, while Carnegie comes in close with declines across a larger dollar value, down -49.7% over the 12 months resulting in a reduction in transaction value of $179m. The regional suburbs of Heyfield and Lucas however have seen turnover double over the same period, although with property values much lower across these regions, this makes up a much lower dollar value turnover relative to the capital city regions. Particularly in comparison to the lower year-on-year sales values across the highest sales value list.
Regional coastal suburbs of Queensland have recorded the greatest value of transactions over the year, comprising of both Sunshine Coast and Gold Coast suburbs, however turnover is lower across all regions. Although transaction volumes are lower, Noosa Heads has seen the value of properties that have transacted increase by 3.8%. Contrary to the declines are the capital city suburbs of Spring Mountain and Joyner where the value of turnover is higher over the year to February. Jacobs Well on the Gold Coast and Berrinba in Brisbane have recorded the greatest declines in transactional values down up to 65%.
Across South Australia, the majority of suburbs making up all 3 lists were situated in Adelaide. Of the highest sales value suburbs, Prospect and Mount Barker were the only two suburbs where the total value of sales was higher in February 2019 compared to a year earlier. Bowden however recorded the greatest uplift with almost double the value of sales year-on-year. The regional suburb of Risdon Park South saw the greatest reduction in sales values over the past 12 months, down -47.3%, however the overall value of properties turning over in this region is lower than the remaining four capital city suburbs in this list.
Across Western Australia, the Perth suburbs of Treeby, Helena Valley and Wandi have seen the value of sales higher over the year. Treeby, with the total value of sales up 162% year-on-year is the suburb with the greatest increase. Perth’s Scarborough and Claremont, made up the top 2 highest total value of sales list over the year to February 2019, also being the only 2 suburbs in the top 5 list where sales value turnover was higher than the 12 months ending February 2018. Gidgegannup saw the largest decline in total sales value across the state over the year.
All 3 of Tasmania’s top list include suburbs across both regional and capital city parts of the state, the highest total value of sales was Sandy Bay, although, the suburb saw a lower turnover value over the year. Lindisfarne in Hobart not only made up one of the highest transactional value suburbs, but also the greatest increase in the total value of sales year-on-year up 80%. The regional suburb of Mowbray saw the greatest decline in the value of sales across the state, although in terms of volumes there was only 6 fewer sales, indicating substantially lower valued properties transacting.
Across the Northern Territory, Humpty Doo and Gillen saw the greatest value of sales over the 12 months to February, higher than figures from a year earlier. While Moulden had a lower total dollar value of sales than Humpty Doo and Gillen, the value of sales increased by 88.6% over the year, coming in just above the 86.7% increase in total sales value across Humpty Doo. Desert Springs in regional NT, saw half the value of sales over the year compared to one year earlier.
The Australian Capital Territory has actually seen some of the lowest transactional value decline suburbs, with the greatest decline seen across Issacs with a -36.8% decline in the value of sales year-on-year. While the top 2 highest value of sales was recorded across Kambah and Ngunnawal increasing by 8.5% and 5.3% respectively over the 12 months to February 2019. In terms of highest percentage value increase, Higgins recorded an increase in the total value of sales of 63.9% in February 2019.
The analysis includes suburbs where at least 20 transactions over the 12 months to February 2019 and 2018.
Data tables include the below top 5 list for each state
Table 1. Highest total value of sales over the 12 months ending February 2019 vs February 2018
Table 2. Greatest increase in the total value of sales over the 12 months ending February 2019 vs February 2018
Table 3. Greatest declines in the total value of sales over the 12 months ending February 2019 vs February 2018