# Higher Interest Rates. What Happens to House Prices Next? | Wilson Monthly - September

An episode of [Money Mentor Podcast™](https://invisiblenetwork.ai/podcast/1632604767), 29 Sep 2026, 58 min.

Audio: https://episode.flightcast.com/01M3NQ1JM7YS4QV0ER8AW2GHC1.mp3

Even Australia’s boom property markets are recording falling house prices, but could higher interest rates tell only part of the story? Dr Andrew Wilson examines the September housing data, the RBA outlook and mortgage pressures, revealing why housing shortages and early signs of a spring revival deserve a closer look. Want to improve your own financial future? Our free webinar is where to start: 👉 https://bit.ly/43V2jKN #AustralianProperty #InterestRates #HousingMarket

## Transcript

[0:00] Even the boom markets are recording lower house prices.
[0:03] Dr. Andrew Wilson, Chief Economist at My Housing Market, has spent decades studying the Australian property market.
[0:11] In this episode, he breaks down what the latest data is telling us and why higher interest rates might not mean what you expect for house prices.
[0:19] Just three years ago, prices are going down.
[0:23] Look what happened.
[0:27] Welcome everyone to another episode of Wilson's Monthly.
[0:30] I'm Sam and I'm joined with Dr. Andrew Wilson here, Chief Economist of My Housing Market and been doing this stuff for over two decades.
[0:37] More than that.
[0:38] More than that.
[0:39] How long?
[0:40] I don't really want to say.
[0:41] Give something away.
[0:42] You'll reveal how old I am.
[0:44] That's a state secret.
[0:45] But look, long enough to have seen it all really.
[0:48] And there's nothing new in terms of what happens in Australia's housing market.
[0:51] It's the higher interest rate cycle.
[0:53] It's the lower interest rate cycle.
[0:55] And we just seem to create the same sort of headlines.
[0:58] Well, I'm curious if it's all relatively the same kind of stuff.
[1:01] And you've been doing it for so long.
[1:02] Why...
[1:04] Why are you still doing it?
[1:05] Well, the lessons aren't learned, are they?
[1:07] This is the point.
[1:08] We keep going through the same cycle of negativity as soon as we see higher interest rates.
[1:14] I always remember 2019.
[1:16] The Reserve Bank started telling everybody that next move in interest rates would be up.
[1:20] And as prices started to ease, which was the cycle just waning, there was a lot of media about the prospects for house prices.
[1:28] And we had the most outrageous forecasts coming through the media.
[1:32] The predictions that house prices were going to fall by up to 40%.
[1:36] 40%!
[1:38] Give me a break.
[1:39] Absolutely no historical precedent for that.
[1:41] But, of course, it generated a lot of headlines.
[1:43] The Reserve Bank, because the economy had been stagnating, actually stepped in and cut interest rates three times during the back end of 2019.
[1:52] And prices increased by 15%.
[1:55] So we went from there, some bricks and slaughter,
[1:58] Terrible outlook to once interest rates started to fall, we moved back into boom time mode.
[2:06] Nobody knows what the future is going to hold.
[2:08] I mean, that's always the condition here.
[2:11] But we can only really deal with history and the fundamentals.
[2:15] And that's what we look at here every month is how the fundamentals are progressing in the face of all the negativity as well as looking at what's happened yesterday.
[2:27] in terms of history as well.
[2:29] So let's have a look at some insights in terms of what we do every week.
[2:34] All this is brought to you by our good folks at Infinity.
[2:37] And of course, our data and commentary is a product of my housing market.
[2:42] But as I said, it's really important to understand that
[2:44] This is what we say here isn't just, I guess, opinion or economic or academic dogma.
[2:51] It's evidence-based, you know.
[2:53] So if things don't sort of work out as we're looking for them to work out, it's because the data's changed, you know, going forward and the environment's changed.
[3:02] So our latest housing market news.
[3:04] Let's have a look at our key themes for this month.
[3:07] The RBA is set to rates in September.
[3:10] the outlook for inflation, the economy and interest rates going forward.
[3:14] We had the latest migration data announced last week.
[3:18] That was for the March quarter.
[3:20] And what's really interesting, we've seen a real change in the attitude from the government towards migration.
[3:26] Of course, we'll have a look at the latest home prices.
[3:29] Rental markets are tightening, vacancy rates are falling, but we've actually seen, interestingly, rents are easing slightly.
[3:35] So I don't know whether this is a trend.
[3:36] We'll have a look at that.
[3:39] Western countries generally are suffering from undersupply, not enough housing for the population.
[3:47] We're in the spring selling season now.
[3:49] Well and truly, that's usually a period where people do start to become active in the housing market, notwithstanding what's happening with interest rates and the general price cycle.
[4:00] And we're seeing some early signs of an improvement in our auction markets over the last couple of weeks.
[4:09] is the best performer.
[4:10] And Melbourne's been the best performer for some months now.
[4:13] So we're going to talk about, I guess, the elephant in the room is interest rates.
[4:16] Most commentators are now saying, I think, most of the big banks, not all of the big banks, are predicting an interest rate increase in September now.
[4:25] And now a number of them are also predicting an increase in November, which is that Melbourne Cup meeting.
[4:32] So we've got that to look forward to, which, of course, is not good news for mortgage holders, higher interest rates.
[4:39] The Reserve Bank sort of signalled that at its last meeting when it said some main points there that inflation is too high and it's not expected to turn around towards the target range until the end of 2027.
[4:56] So it's obviously very bearish about the outlook for inflation.
[5:00] I'm curious about the first sentence, the disruption of global oil supplies adding directly to inflation.
[5:06] So if the global oil supply is adding directly into inflation, why is it that we raise interest rates on the average?
[5:15] It's not going to change the price of oil.
[5:18] good to an economy such as oil, aren't fixed by higher interest rates.
[5:23] They've just got to work their way through the system, which is what we saw during COVID because oil prices got up to, you know, $130 US a barrel.
[5:33] And interest rates went up as a result of that because inflation generally was rising, other factors too.
[5:39] But the higher interest rates didn't fix the oil price because that was just because all the supply constraints through COVID,
[5:46] had to ease, you know, and that just takes time.
[5:49] It's the same story now.
[5:50] You know, oil prices are higher, not because there's a shortage of oil per se, it's because people are expecting that to occur.
[5:57] Speculators are pushing up the price of oil.
[5:59] So until the...
[6:01] It's not even constrained yet.
[6:03] They're just putting it up in case it does constrain.
[6:04] Well, they're saying what's going to happen because the war is continuing, right, and that there's still so much uncertainty that they feel that that's a likelihood is that, you know, oil prices will rise eventually because there will be a shortage of oil.
[6:17] But when we saw the first sign that oil prices, that the Iran-US conflict was going to end, remember that?
[6:26] What, three months ago, four months ago?
[6:28] They said, hey, we've got a peace treaty, everything's cool.
[6:30] Yeah, well, all prices went down to $67, $66 a barrel in the expectation.
[6:37] Because the floodgates will open back.
[6:38] Well, it's going to be.
[6:39] And all the talk was, hey, 2027, we're going to have a glut of oil.
[6:43] We're going to have this really cheap oil because we've got so much oil, global oil.
[6:49] So the reality was too much oil, not enough oil.
[6:52] But now, you know, the spectre of a continued conflict between the US and Iran means that, you know, the expectation is that oil prices will be higher.
[7:03] And the point is that once oil prices are higher, people then start to look to push up their wages, their income, to offset what is obviously the cost of oil has a significant impact on the economy generally.
[7:16] From transporting something from one place to the next to fueling their equipment.
[7:22] Exactly.
[7:23] And so they've got to charge more.
[7:24] Yeah.
[7:25] Everyone else pays more.
[7:26] Even if it's just at the bowser.
[7:28] I mean, what are you paying for oil now?
[7:31] Ridiculous.
[7:31] It's $2.40 nearly.
[7:33] Now it's like, hey, boss, I want some more wages to cover my increased fuel costs.
[7:39] Goods and services are rising because delivery costs are increasing again.
[7:44] Mortgage costs more.
[7:45] Everything costs more.
[7:46] Well, that's right.
[7:47] Sure.
[7:48] Sure.
[7:49] So as I said, we're looking now at an interest rate increase next at the end of September.
[7:55] So we're going to have to work with that.
[7:59] And there are some other factors which we'll look at shortly that are sort of an offset, and that's what's happening with the economy.
[8:06] So let's just have a look at the cash rate.
[8:07] We can see we had those cuts last year, which had me scratching my head a little bit because we hadn't really conquered inflation.
[8:14] So back up again.
[8:15] So we lost those cuts we had last year, and now we're sort of going to be a net loss in terms of where we've been over the past few years in terms of exactly where our interest rates will be.
[8:26] So, okay.
[8:28] But we can always say, which is true, that we've had probably over that period of time, the last couple of years anyway, we've had increases in our income of, you know, maybe about 6% or 7%.
[8:42] So the offset has been to those higher interest rates has been higher wages, you know, so that gives us some leeway to offset those higher interest rates.
[8:54] And a lot of people don't didn't take the cuts last year.
[8:58] You know, when they when we had our interest rate cuts, a lot of the banks say, look, just leave if you like, you can leave it where it is.
[9:05] at your existing repayment.
[9:07] Yeah.
[9:08] So they really didn't feel it when the interest rates went up again earlier this year because they left them where they were when they were cut a year ago, if you get what I mean.
[9:17] So they didn't go in and ask for that drive down.
[9:20] They just left it where it was, right?
[9:23] And so they've come with a net positive.
[9:25] So the higher interest rates this year hasn't impacted them, right?
[9:29] The question is whether...
[9:30] we will have further rate rise.
[9:32] So what's the looking forward?
[9:34] What's the scenario in terms of interest rates?
[9:36] So firstly, we've got to look at the inflation data.
[9:40] And you can see there, we actually had an increase in fuel.
[9:43] Now we've got the next lot of inflation data will come out
[9:48] in a couple of weeks' time, end of September.
[9:52] This is the latest data, which was July.
[9:55] We had some improvement there with electricity, still rising, but not as it's been because it's no longer affected by the changes in the subsidy, right?
[10:04] So we've got two sorts of inflation.
[10:06] We've got headline inflation, which ABS measures,
[10:09] as being all the basket of goods.
[10:11] That's all the stuff we buy.
[10:14] But the Reserve Bank looks at another measure, which is called underlying inflation, which takes out the volatile elements, right?
[10:20] Seasonal aspects like food, because in some months, like winter months, food's more expensive.
[10:25] So they take that out financially.
[10:27] Fuel can be seasonal as well.
[10:29] So they're the elements that have either decreased a lot or increased a lot compared to everything else.
[10:36] So it's like the top 10, I think it's the top 7%, and the bottom 7% they take out.
[10:41] And it's that underlying inflation rate that they look at as being what they look at for their interest rate policy, right?
[10:51] So that's the main points, the main...
[10:54] The main factors in the inflation rate and what the Reserve Bank is looking at is certainly fuel.
[11:01] So let's have a look.
[11:02] And this is really exciting at the price of fuel.
[11:05] Can you see?
[11:06] So this is the international price of oil.
[11:08] So then we come obviously there to April this year.
[11:13] And that's the impact we can see there of the Iran-US conflict.
[11:19] Now, you can see it actually sort of improved quite significantly there.
[11:24] And there was, you know, it looked like there was going to be a peace treaty, right, in April and May.
[11:30] So that's that big drop.
[11:31] That's that big drop.
[11:32] Right in between April and July.
[11:34] And that was all speculation.
[11:36] It was all like, oh, this is doom and gloom, end of the world for oil.
[11:40] And then they got the peace treaty.
[11:42] And then they didn't have the peace treaty.
[11:44] It all went pear-shaped and they started the conflict again.
[11:48] Up it went again.
[11:49] And you can see how it's bounced up and down since then, right?
[11:53] So this is the latest sort of data.
[11:55] I mean, who knows what it is, what it will be in, you know, five hours' time.
[11:59] But certainly it's up there again.
[12:02] But what's really important to look at with this chart to discuss isn't so much where it is now because inflation is measured compared to where it was a year ago.
[12:12] So inflation rate measures the price of something compared to where it was a year ago.
[12:17] So that's the inflation rate.
[12:19] Yeah.
[12:19] So each month what it was a year ago.
[12:21] Right.
[12:22] So the important thing for oil here isn't so much... You see, if oil was like consistently at $80 or $90 a barrel, which is bad, you know, because it's a higher price, but if it's consistently there over a period of a year, it's not inflationary because it's not changing.
[12:38] Because it wasn't there a whole year.
[12:39] Well, it's not changing, see.
[12:41] But the important thing to look at the data now is that when we look back a year to the price of oil, it's actually quite low.
[12:49] It's $60 a barrel.
[12:52] which doesn't look too bad at the moment with 89.
[12:55] But when we compare that, that's a really bad number, prospectively, because we have to get back to around about $60 a barrel to have no inflation impact.
[13:06] To be back to where we were.
[13:07] To just say, well, it's not going to make a difference and therefore it's not going to be an issue for interest rates.
[13:13] But as long as oil is significantly higher now than where it was a year ago, which it is, we're going to have issues with interest rates and inflation.
[13:23] So because April 2026, so the measure in April 2027,
[13:29] Yes, right.
[13:30] Generally going to look pretty good because that was significantly higher.
[13:33] That's right.
[13:34] But now because September, October is low-ish and getting lower, it's getting lower.
[13:43] It's going to get lower all the way through to the end of the year.
[13:46] That's going to be bad for inflation.
[13:49] So that's not good news for interest rates, the outlook for interest rates.
[13:53] And, you know, that's obviously what speculators and the market is factoring in, in terms of their predictions of higher interest rates.
[14:02] We're going to look at a slide soon which shows you that higher interest rates aren't necessarily always bad news.
[14:10] They're not always really bad news for the housing market, if you know what I mean.
[14:15] And we can look at history to sort of explain that.
[14:18] So that's the oil story.
[14:19] That's the inflation story.
[14:21] That's what we're locked into now, because that's the big picture.
[14:24] And that's what the Reserve Bank will be thinking, and that's what other central banks like the US are thinking at the moment.
[14:31] So this is underlying inflation versus the target.
[14:34] The Reserve Bank has a target, right?
[14:37] The US has an inflation target.
[14:39] Its inflation target is 2%, which is actually lower than ours.
[14:43] Our target is 2% to 3%, but they say they want the midpoint.
[14:49] So that's 2.5%.
[14:50] 2.5%.
[14:50] Yeah.
[14:52] So that's the Australian inflation target.
[14:53] We look pretty well off from that.
[14:55] Well, we're not doing really well because you can see we're actually heading north against the target.
[15:01] We're now at the highest point in terms of our underlying inflation rate since back in 2024.
[15:10] And we're going the wrong way.
[15:11] And, you know, the likelihood is that the target will get higher inflation rather than lower inflation because of what we've said about oil.
[15:20] Now, there's another factor that we need to discuss in terms of interest rates.
[15:25] And the Reserve Bank is not just about inflation, right?
[15:28] So they've got a dual agenda.
[15:31] First is control inflation.
[15:33] And inflation has to be in the midpoint of the target range, which is 2% to 3%, right?
[15:40] That's their target range.
[15:42] That's what they're struggling to do now, as we've just seen.
[15:45] But the other factor that the Reserve Bank has as an agenda is full employment.
[15:53] So it's not just controlled prices.
[15:55] They also have to provide full employment, right?
[15:59] which has been looking pretty good for a long time now.
[16:01] We've had a really strong economy for a long time.
[16:05] We had unemployment rates for years post-COVID in the 3%, you know, 3.5%.
[16:13] But the interesting thing, Sam, now is we're actually starting to look like we're moving out of that full employment environment for the first time in a long time.
[16:25] We've had two months in a row now with a higher unemployment rate.
[16:30] It's still quite low.
[16:31] It's starting to get too excited about, but the trend is now starting to look a little bit more, I guess, concerning because the trends have been pushing upwards now over this year so far.
[16:46] So we're up to 4.6%, still quite low, but I gotta tell you, probably the benchmark for unemployment when we start to think, hmm, this isn't so good, is 5%.
[16:55] All right, so once you start moving into 5% territory, it's like, oh, gee whiz, this is a little bit of a concern.
[17:05] And we're sort of, we're not there yet, but we're sort of heading towards that.
[17:09] So there are a few disclaimers.
[17:10] We actually increased jobs by 39,000 over the month, which is good.
[17:15] But the number of unemployed actually went up 28,000.
[17:18] How do you do that?
[17:20] Is that sector-based?
[17:22] Like we flooded the market with heaps of jobs in one area and lost a heap in another?
[17:25] Well, we could have, yeah.
[17:26] But this is overall what happens, right?
[17:28] And it's a survey they do, so it's not exactly the exact number, it's a survey, right?
[17:34] So it can be a little volatile going forward.
[17:37] But it's the trends that start to reveal exactly what's going on, right?
[17:41] Now, so we had a higher unemployment rate, even though we had a big pickup in the number of employed.
[17:50] So it's like, oh, how come?
[17:51] We've created a lot of jobs and yet we've got a higher unemployment rate.
[17:54] The reason was that our unemployment,
[17:56] participation rate.
[17:57] Now the participation rate is really important because it measures the proportion of the population or the potential workforce that's actually working.
[18:07] They're people who are saying they're in the workforce.
[18:10] They might not have a job, but they're looking for a job.
[18:13] Right.
[18:14] So they're in the workforce.
[18:15] Now, that can change from period to period because people move out of work, they retire, they become self-employed, right?
[18:23] And that can change.
[18:24] Now, we've had for a number of years now record high participation rates.
[18:29] So what happened was when you get more people coming into the workforce, not necessarily working, it increases the pool of employed people.
[18:37] So what's happened is there's more people to be able to, you know, to find work for, right?
[18:45] So you've had a bigger basket of people who are looking for work, and that's what pushed the unemployment rate up, right, even though job numbers have increased.
[18:57] Do you understand?
[18:57] Because the workforce has got bigger, right?
[19:01] And that means that you've got to find more work,
[19:04] for people, right?
[19:05] And that's why the unemployment rate went up.
[19:07] And, of course, the point that the Reserve Bank has to consider is that, you know, higher rates are not good news for the economy and for the labour market because, you know, it's extra costs for employers, you know, to meet.
[19:24] and that can put upward pressure eventually on the unemployment rate.
[19:29] I think that's what we're sort of seeing maybe just starting to emerge here.
[19:33] So it's another factor the Reserve Bank's got to think about.
[19:36] Hey, we've got to control these oil prices, got to put up interest rates, but hey, we've got to be careful here because the unemployment rate is just looking a little softer at the moment.
[19:46] We can't go gung-ho too much here because we've got two agendas, not just inflation,
[19:51] We've also got to provide a full employment economy.
[19:56] So it's, you know.
[19:57] To make sure they can afford these prices that are about to go up.
[19:59] So what do you do if you've got that choice?
[20:01] What do you do?
[20:02] You know, this is what can evolve into what's called stagnation.
[20:09] Stagnation, where you get not a lot of growth but high inflation, you know, which is really bad news.
[20:17] So what do you do then?
[20:18] Because you've got to control inflation.
[20:21] Right.
[20:21] But you've got to keep people in work.
[20:23] Right.
[20:25] So this is just starting to look a little bit more problematic.
[20:29] Still OK. Let's not get too doom and gloomy here.
[20:33] But it's certainly adding a little bit more of a complexity to what's happening with monetary policy, you know, because I've got to be a little careful here.
[20:43] This is two months in a row now.
[20:45] Yeah, we can say, okay, it's a great participation rate.
[20:49] That's increased the actual workforce, potential workforce.
[20:55] But at the end of the day, it's, you know, another big rise in the number of unemployed.
[21:01] And, you know, it's another factor to look at.
[21:04] So interesting going forward.
[21:07] We need to keep watching that.
[21:09] That's the unemployment rate.
[21:10] See, it's still pretty good.
[21:11] If you go back.
[21:12] You know, even at 4.6%, it's still lower than where it was during those big mining prunes we had, you know, 20 years ago.
[21:22] And certainly better than where it was in the pre-COVID period.
[21:26] What's interesting there when you look at state unemployment rates is Victoria is being consistently higher than the other states in terms of the unemployment rate.
[21:39] And it's been above 5% for some time now, consistently.
[21:44] Remember I said 5%, sort of that little bit of a benchmark.
[21:48] So I mentioned migration.
[21:51] I think it's important that we look at migration.
[21:53] And when we look at the migration numbers, you can see how it's really fallen away since we had the end of the COVID lockdown.
[22:02] That section there, though, the 2023 is significantly higher than it was.
[22:08] It almost looks like it's levelled out to what it's been historically.
[22:11] Yeah.
[22:11] But what we're seeing now, and there was a lot of policies in the budget, and one that wasn't given a lot of impact was that they're actually now looking at having around just
[22:25] around 200,000 net migration in the next financial year, which is a lot lower than the 300,000 we normally take.
[22:36] And that's a really big drop around migration.
[22:41] When is that meant to kick in?
[22:42] For this particular fiscal year up to 27.
[22:50] And these numbers are quite lower, though.
[22:52] Those numbers are quite lower that we're seeing now.
[22:57] And it's interesting because it's the Labor Party, you know, very much a positive migration party.
[23:06] And it's a big...
[23:08] It's a big drop in terms of migration going forward.
[23:12] And I do think it's a lot to do with, you know, the fact that, you know, they're finding that the... Supply of housing.
[23:18] Yeah, well, the supplying of housing, you know, that they...
[23:22] don't have the infrastructure to meet.
[23:25] And they're still worried about a breakout, particularly in rental, because that's where a lot of the demand is in the rental market for migration, you know, migrants.
[23:37] When we look, this is the overseas annual migration numbers on a state basis.
[23:43] So this is the difference between people leaving the state and coming into the state.
[23:48] New South Wales still leading.
[23:53] but behind New South Wales.
[23:56] I think what's interesting is just how strong Western Australia has been.
[24:01] Big numbers in terms of net international migration into Western Australia have been.
[24:08] Do you mean from where it has been historically?
[24:10] Yeah, yeah, yeah.
[24:11] Because comparatively it's obviously a bit lower than New South Wales, Vicky, Queensland.
[24:14] Yeah, but not a lot given their population compared to, say, Queensland, you know, and I think that's a lot to do with how Raboon State it is at the moment, particularly how strong the Perth housing market is.
[24:26] And it's interesting when we look at interstate migration, so this measures...
[24:31] the difference between people moving interstate, interway state and then leaving a state.
[24:37] And you can see Western Australia is still a very, very strong population.
[24:42] There's a very strong exodus into Western Australia from other states.
[24:47] New South Wales always has a loss.
[24:49] Victoria has been flat.
[24:52] There was a huge exodus through COVID out of Victoria, particularly into Queensland.
[24:56] Into Queensland, right.
[24:57] But Queensland's actually fallen away just a little bit, the net migration into Queensland, which is quite interesting.
[25:03] Yeah.
[25:04] Because it's usually been around about the same figure as New South Wales.
[25:08] But whatever New South Wales has lost, Queensland usually is very similar to what it's gained.
[25:14] But, yeah, Western Australia has been not just in international migration strong, but also in interstate migration, net migration.
[25:23] But as I said, the big picture is the government is a...
[25:26] It has a definite policy to reduce migration.
[25:31] And they also...
[25:33] recently announced that the student visas, international student visas, the number that have been rejected is now at the highest level ever.
[25:43] I think it was about 25% of applications for international student visas have been rejected and that's just another sign that the government is reducing the number of migrations coming in.
[25:59] Mainly because a student would predominantly come here to rent
[26:02] That's right.
[26:03] Well, they don't normally purchase.
[26:04] They're not going to buy a property.
[26:06] I mean, they do purchase, but mainly it's rental properties, you know.
[26:11] And that's why we saw a big surge in rents in the post-COVID period when lockdowns finished and the borders were opened up.
[26:21] But this is very important because it actually reduces the demand of supply in the housing market, right?
[26:29] And I think this is part, again, of that agenda from the government to try to match supply and demand.
[26:37] So we'll look at what's the latest building approval data, which isn't great, but the targets that the government had for new building, new home building, has really just, you know, forget it.
[26:48] It's not even closed.
[26:50] Now, meat and potatoes, this is what we look at every week, what's happening with house prices.
[26:56] Not good news.
[26:57] And, of course, this is, in a way, we're not going to see an improvement in terms of the model.
[27:02] So what this data is, is what we're looking at is three months of data, right?
[27:07] Right.
[27:08] and we take it month by month by month.
[27:10] So what we're doing now, this is August, right?
[27:13] So we're taking three months to August.
[27:16] We're taking all the sales there and we're looking at the midpoint and we're looking at the change.
[27:21] all with the exception of Darwin, are over August felt recorded lower prices.
[27:28] Interestingly, Sydney and Melbourne were the underperformers and they have been leading the charge downwards in terms of prices.
[27:36] Also Adelaide, which was very strong,
[27:39] Even the boom markets of Brisbane and Perth are recording lower house prices.
[27:44] And, of course, they were massive increases.
[27:47] And all we have to do is to look at what's happened over the last year to see even with those higher interest rates, Brisbane is still up 8.8% over the past year.
[27:58] Yeah.
[28:00] and Perth is still up 16% prices, still up with those higher prices, but it's different for, and that really emphasises the underperformance of Melbourne and Sydney are both up, sorry, down 5%.
[28:16] over the past year, whereas the other capital city markets are still up quite strongly over the past year, but are still starting to ease.
[28:25] Now, what's really interesting in terms of prices is that houses are doing better than units, right?
[28:32] Which is quite interesting, particularly Melbourne.
[28:35] and Sydney are performing a lot better in units than for houses.
[28:40] In fact, they're only down marginally in terms of the monthly data, although they're certainly down similarly over the full year.
[28:50] But as I said, it's interesting.
[28:51] Why is that interesting?
[28:52] Maybe it's more affordable.
[28:53] Maybe it's, you know, people are.
[28:56] It's a different profile.
[28:57] It's not as broad, the market, the houses.
[28:59] You mean interesting because you would expect them to be relatively similar, but people are still looking for places in the same areas.
[29:04] More affordable.
[29:05] So therefore, they're falling, but only falling marginally, whereas the significant falls are happening in houses, particularly Melbourne and Sydney, but not as strong the decline
[29:18] in units, which is quite interesting.
[29:21] And I think it's because it's not as volatile as a set of data, right?
[29:25] And more affordable units, you know, maybe people are more inclined in a downturn to look at more affordable options, such as units.
[29:35] But certainly that... Is it a trend?
[29:37] Like there's just... Well, it certainly has been.
[29:38] Where we may be heading towards moving into units and going up.
[29:41] Well, it could be that as well.
[29:43] Yeah.
[29:43] And affordability advantages, you know, as I said.
[29:46] But...
[29:47] It's certainly interesting that price declines are much lower for units than for houses.
[29:56] In fact, they're probably just flat, you'd say, what's happened with unit prices compared to houses.
[30:05] And still some very big results for units over the past year in the boom markets.
[30:10] Brisbane unit prices are still up 17.0.
[30:12] I mean, that's huge.
[30:14] Brisbane units are still up 17.2% over the past year, which is massive.
[30:21] And Perth's up 14.8% over the past year as well.
[30:26] So, you know, boom time results in those markets, particularly for units, but also now easing lately.
[30:37] So what's going to happen...
[30:40] with more interest rate increases going forward.
[30:42] And of course, it will have the same impact.
[30:45] And part of that is because we're measuring three months, right?
[30:49] So we're measured up to August.
[30:50] So we're still measuring in winter, which is traditionally a softer period anyway.
[30:56] And of course, you've got higher interest rates as well and all the negativity as well.
[31:02] So we would expect it will take a couple of months using three months of data
[31:07] before you start getting out of the winter season and really into the spring season for the market.
[31:15] Meaning what the results are showing.
[31:16] Yeah, and that means that we're still going to see lower prices going forward, even just with the seasonal impacts, because we're dealing with the winter market.
[31:27] Right, which is always, you know, there's less energy always in the winter market, regardless of what the cycle's doing, rates up or down.
[31:34] And it does revive through spring.
[31:36] And we're only, we're not even, we don't even have the one month of spring yet in our models.
[31:41] We'll have that released in a couple, in a week's time.
[31:46] But.
[31:46] And we have the added constraint of maybe some higher interest rates.
[31:53] So this is the model where we're using monthly data.
[31:59] Well, it's really three-monthly data, but we're just advancing it month by month.
[32:04] But what we're going to do, which you won't see anywhere else, but just with our modelling, we're going to have a look at what happens.
[32:10] And this is great stuff because this is daily data.
[32:14] Daily.
[32:15] Daily data, right?
[32:16] So what we're talking about was month to month, three months, right?
[32:21] This is day to day with three months.
[32:23] So even though we're still in that winter period, we're now seeing the changes on a day by day basis, right?
[32:32] And it's really interesting.
[32:33] So we'll look at the major capital cities, right?
[32:35] So we'll look at the houses across the top.
[32:37] So across the top is Sydney, Melbourne and Brisbane.
[32:40] So these are house prices.
[32:41] Can you see how really accurate that is?
[32:44] how it's changing, and it really gives you the trend, right?
[32:49] And that's why we use that because it's a visual model because you can actually, your eyes are telling you what's happening with the market in terms of the decline, the rate of decline.
[33:01] You can see that.
[33:02] So in all of them, there's quite a steady rate of decline.
[33:05] That's right.
[33:06] And look quite sharply in Sydney and Melbourne.
[33:09] That's right, 100%.
[33:10] And that's telling you what's happening.
[33:12] So you can see Melbourne and Sydney, obviously, Melbourne quite steep at decline.
[33:19] in house prices.
[33:20] That's telling you what's happening.
[33:21] From around about March up until now.
[33:23] That's right.
[33:23] There was a little dip in an improvement, which always happens in Melbourne in the autumn selling season, which is particularly March.
[33:33] And then we had those higher interest rates and down she went.
[33:37] Sydney just really down.
[33:39] And Brisbane, you can see how strong Brisbane has been.
[33:42] You can see it just really upwards.
[33:44] And then it too has eased from the higher interest rate period.
[33:49] That's telling you exactly what's happening, right?
[33:51] Your eyes will tell you exactly what the market's doing.
[33:55] And this is day by day up until yesterday, right?
[33:59] So it's real time in a sense data model.
[34:02] So what people are actually feeling out there when they're buying.
[34:06] Well, you can see it.
[34:07] Yeah.
[34:07] Right?
[34:08] Yeah.
[34:09] Now, what we're going to do is compare units with houses.
[34:14] So along the bottom, that's the charts for units, right?
[34:19] So what's really interesting, and this is what we saw with the numbers, with the monthly data, is that units are outperforming houses.
[34:29] You can see it's still falling.
[34:30] You can see Sydney there.
[34:31] Nowhere near as sharp.
[34:32] Nowhere near as sharp.
[34:34] You can tell it's nowhere near as steep, the decline.
[34:37] And that's telling you.
[34:37] That's telling you the story in a picture, right?
[34:41] And what's really interesting, and this has surprised me, and we've seen this early for last year, Melbourne units.
[34:47] Look at Melbourne units.
[34:48] They're actually, yeah, they're falling, but not by much.
[34:51] You can see that.
[34:52] Not by much at all.
[34:53] And see how steep the decline in prices are for Melbourne, and yet look at prices for units for Melbourne.
[35:00] Yeah, it's down, but it's pretty flat.
[35:03] And you would have thought, what's going on here?
[35:06] And like I said, it's been a surprise to me.
[35:09] And also, interestingly, given how strong Brisbane units have been and they've been spectacularly strong, just recently they've started to ease a bit more, which is a bit of a surprise different to Melbourne, which is sort of outperforming houses for units, but for Brisbane.
[35:28] But units are actually underperforming a little bit in Brisbane.
[35:32] They look relatively similar to the trend of what's happening.
[35:35] But given how, look how strong, you see the slope for units?
[35:39] That's like the stairway to heaven.
[35:41] Especially from the end of 2024 or mid-2024 all the way up.
[35:44] Up she goes.
[35:45] It's just like, you know, up to the penthouse all the way up, but has started to ease.
[35:51] And just recently...
[35:53] A little bit steeper, just over the last few weeks, we've started to see, or perhaps the last month or two, started to see a decline in unit prices in Brisbane.
[36:05] So, look, what we're trying to do here...
[36:07] is give you the evidence of what's actually happening in the housing market with real data, right?
[36:13] This is the evidence of what's happening in the market.
[36:17] And certainly it tells the story in terms of prices and we really do need to start moving into...
[36:24] certainly into September and October, to offset what's happening with that winter market before we're seeing a revival.
[36:32] Now, the latest data, and I don't want to go too early here, this data was taken at the middle of this week.
[36:40] Now, I took a snap yesterday saying,
[36:44] And there's actually just a slight sign, and I'm not going to oversell this, but the Sydney and Melbourne cycle is just starting to look like... That little scoop.
[36:56] Just that little scoop, right?
[36:59] I'm not saying anything here.
[37:01] So it's just starting to show a little... You can see maybe a sign of that.
[37:06] Can you see that?
[37:06] Are you seeing that in Brisbane as well, though?
[37:08] Yeah, and in Brisbane, maybe.
[37:09] Not so much.
[37:10] But, yeah, maybe a little bit in Brisbane.
[37:12] But you can just see in Melbourne...
[37:14] I feel like I can read all these economic graphs.
[37:16] Yeah, that's – well, you've just got to have eyes, you know, and it's not – but that's what I'm saying.
[37:21] But, yeah, you can see those little things.
[37:23] We're not looking at like 3%, 4%, up, down, whatever.
[37:25] This isn't giving you an actual visual sense of the market, you know, without saying how much it is.
[37:33] You can actually tell the slope.
[37:35] the steepness of the slope telling you.
[37:38] But maybe just showing, and we need another, you know, a few weeks, another month of data just to say, yeah, maybe it's just starting, maybe it's just starting to think about the bottom.
[37:49] thinking about the bottom.
[37:50] But, of course, we get an interest rate increase and then we get maybe another one.
[37:56] That will obviously, you know.
[37:58] Show us what's going to happen.
[37:59] Well, it will have a negative impact.
[38:01] It would have a negative impact.
[38:02] But we're going to talk about something now to describe that.
[38:05] So this is interesting, Sam.
[38:11] This is recent history in terms of an interest rate increase cycle.
[38:16] So we've spoken about COVID, right?
[38:19] So when we came through the stimulus period through COVID, we dropped our interest rates way down to 0.1%
[38:31] We spent all this money, fantastic fiscal policy expansion to get us up and running through COVID.
[38:38] And then, of course, we got the highest inflation rate that we had since the early 1970s.
[38:47] So, of course, the Reserve Bank stepped in, put up interest rates because we had all this inflation.
[38:52] So we had interest rate increase.
[38:54] We had 13 interest rate increases between May 22 and...
[38:59] and November 23, 13 interest rate increases.
[39:04] Hey, we're talking how many at the moment?
[39:06] Three.
[39:07] Three, yeah.
[39:07] Right?
[39:08] Maybe four or five coming this year altogether, maybe.
[39:12] But you can see that we had 13 interest rate increases because of high inflation coming through.
[39:17] Now, what's happened to house prices during that period?
[39:20] So that's the interest rate cycle up till November 23.
[39:25] Now, this is what happened with house prices.
[39:28] So obviously when interest rates were at record low levels, record high levels, sorry, record low levels, we got a boom in prices.
[39:39] So you would expect that they would continue to come down if the interest rates are going to continue to jump up?
[39:44] Well, they're going up and you can see how prices are going down.
[39:47] So they're going up.
[39:48] Interest rates going up.
[39:49] Prices are going up, as we would expect.
[39:51] Prices are going down right till the end of the year.
[39:57] Interest rates kept increasing, but prices started to rise again.
[40:01] Prices started to flow straight back up, even though the rates are going back up.
[40:05] Even though rates were going up, because people are like, yeah, whatever, I need it.
[40:09] So that's that feeling that you were talking about earlier of people just get back into it.
[40:14] Well, they've got the life decisions to make.
[40:16] We're just going to get back on with life.
[40:17] Especially through the end of year period.
[40:22] People are sitting there, you know, they're having Christmas dinner, whatever, they're thinking, you know, I really, see that house, it's really cheap.
[40:28] You know, that would be great.
[40:29] We could trade up and we could make money on it.
[40:31] You know, yeah, we'll lose a little bit, but we'll actually get a great discount for a higher, you know, all that sort of stuff.
[40:36] And people make those decisions during the break, right?
[40:40] And even though interest rates are increasing, and they were through that period, prices, look, they consistently increased through that period and still higher rates.
[40:50] And they were higher than where they were at their low interest rate period.
[40:54] Right.
[40:55] So it's not.
[40:56] The prices are higher than where they were.
[40:57] Yeah.
[40:57] It's not a truism that interest rates will increase, prices will fall.
[41:01] Early days, yes, especially when you've come from a low.
[41:05] The knee jerk reaction is that high means low, low means high.
[41:07] Yeah.
[41:08] because of all the, hey, this is so scary, you know, prices are going to crash forever, you know, whatever you do, don't buy, you know, all that sort of negative stuff, clickbait, you know, media love it, right?
[41:19] But it just moderates, you know, it moderates the impact,
[41:26] It's like it's the boy crying wolf.
[41:28] Keeps crying wolf, right, until everybody ignores him and the guy gets eaten by the wolf because when it really happens, you know, anyway.
[41:36] I told that story many a time in my day.
[41:38] But it's never like that in reality.
[41:40] But you know what I'm saying.
[41:41] It's probably not a good example.
[41:43] But people just get less immune to the early days of the scare campaign, right, which always comes after a boom, right,
[41:52] And people get, you know, just get on with life, you know.
[41:55] And as long as the, and I think the key thing here is as long as the economy remains robust, as long as the unemployment rate remains low, people do get on with their life decisions, right?
[42:06] Become desensitized.
[42:07] They become to the scary stuff, right?
[42:10] Because it's like, nothing's happening here, right?
[42:12] I'm going to miss out, you know, if I don't get into the market now.
[42:16] And then, you know, people say- Or that, right?
[42:17] Yeah.
[42:18] They notice, oh, I waited.
[42:19] I was waiting.
[42:20] I was waiting.
[42:20] Oh, shit, it continues to go up.
[42:21] Yeah, I remember when I could have bought it.
[42:23] I've still been waiting and they're still saying the same thing.
[42:25] I may as well stop listening at this point.
[42:27] Maybe right now is the point where I'm going to get in because they're telling me it's still going to go down, but it still keeps going up and up and up.
[42:34] The stock comes in and they think, hey, that's just the sort of house I wanted to buy.
[42:39] You know, and if I miss out, right, I'll never forgive myself because that's the perfect, you know, it's just people get on with life decisions and we will see the same thing, I believe, happen once again.
[42:51] Because, you know, this was the inflation that we were having here was about oil but also about all the stimulus that the economy absorbed in the COVID period.
[43:02] So I think that's an interesting thing to discuss and,
[43:05] is if when we look at history, it tells us, right?
[43:08] Yeah, it's scary for a while, but after a while, people think, hey, this is property.
[43:11] We're talking about Australian property.
[43:13] You know, I'm going to miss out if I don't, you know, get back into the market.
[43:16] And it's like it's not about missing out either.
[43:18] It's just that things start to happen and you can just sit on your hands for so long.
[43:22] It's about what that opportunity cost of realising what I already missed out on.
[43:27] And they think, well, what am I going to lose here?
[43:29] I'm going to lose getting the right house.
[43:30] I need an extra room because I've had a child, right?
[43:33] Right?
[43:34] I've got to move to Queensland because I've got a great job there, so I've got to sell and buy there.
[43:39] Stuff like that, you know.
[43:40] They're life decisions.
[43:41] I want to retire, you know.
[43:43] They mean more.
[43:44] What am I going to do?
[43:44] Wait forever?
[43:45] Yeah.
[43:45] You know, and miss out?
[43:47] And this is what happens.
[43:48] We need that.
[43:49] We can't keep waiting for this to maybe start coming down.
[43:52] Yeah.
[43:52] I can't wait another two years until I need another bedroom.
[43:55] And what happens?
[43:55] Bob's coming in nine months.
[43:56] That's right.
[43:57] That's right.
[43:58] And like I said, and you can't, like, I can't take the job, right, because, you know, the market's shit.
[44:04] But the other point is that what happens during the period when interest rates have started to rise, the doom and glooms out there, people go, oh, my God, this is really serious, right?
[44:18] Oh, I'm so scared.
[44:20] And they sit on their hands.
[44:21] They say, oh, you know, we've got to wait.
[44:23] So now.
[44:24] Yeah, that's right.
[44:25] They're waiting and waiting.
[44:26] And what that does is it builds up pent-up demand.
[44:30] So it's demand that would have been released, but it's not because people are like, no, no, no, no, I'm not doing anything.
[44:34] It's like holding the garden hose.
[44:35] Yeah, that's right.
[44:36] Yeah.
[44:37] Yeah, and then so when things start getting better and people are, I'm not that worried, not only have you got the real demand coming through because confidence is returning, but you've also got all that demand that's been held up like the garden house, right?
[44:51] It's all waiting.
[44:52] So you get like a spurt as well as the existing demand coming through.
[44:58] You get the demand for housing that's been...
[45:01] put on hold because of the feed.
[45:03] And you don't know what, and then the little kid who's looking into the nozzle when you open it up doesn't know what hit him, right?
[45:08] That's right.
[45:09] So, you know, I think that's a good graphic, you know, just to sort of explain things.
[45:14] Just quickly, the rental market, interesting rental market.
[45:16] We actually had vacancy rates falling.
[45:19] Usually over August we see a pickup or a reduction in vacancy rates because we get higher vacancy rates during August.
[45:26] July, because that's the holiday period, particularly for higher ed.
[45:30] So you get less demand.
[45:32] So vacancy rates fall.
[45:33] But what's interesting, we just saw a bit of easing in rents, which is a bit counterintuitive.
[45:38] Vacancy rates fell.
[45:39] Why does the vacancy rate go up at that point?
[45:42] Because July is holiday month in higher ed.
[45:46] Yeah, in between semesters.
[45:47] In between semesters.
[45:49] So therefore you don't get the same demand for rental properties because people are moving from one course to another or they're moving into a course, so therefore they're looking for somewhere to live, right?
[46:00] So there's more demand, particularly for units, you know, and accommodation.
[46:04] Right.
[46:04] So you have less demand in July because of seasonal factors, but then they all come back in in August.
[46:12] So vacancy rates fall.
[46:13] I mean, at the margin, it's meaningless, really, because these vacancy rates are so low, you know, it's like, you know, that they're very low, particularly for houses, record low vacancy rates continuing.
[46:25] And vacancy rates for units are a little bit higher than houses, but generally low vacancy rates anyway, with the exception of Melbourne with vacancy rates over 2%.
[46:37] But as I said, just an interesting, I guess, paradox that we're seeing lower rents despite lower vacancy rates.
[46:44] But these things move over time in different environments.
[46:49] And so we'll just see how that works.
[46:50] And what's the – you had a bit of a benchmark for inflation and for things like that.
[46:55] What's the vacancy rate one here?
[46:56] 2%.
[46:57] 2%.
[46:57] Yeah.
[46:57] 2% is – So in the houses for every capital city, below 2%.
[47:01] Yeah.
[47:01] Oh, that's crazy low.
[47:03] And other than Melbourne and Canberra in the unit prices, they're all below 2% as well.
[47:08] The 2% is usually the difference between rents being flat, not being higher, not being lower.
[47:13] Yeah.
[47:14] Anything below 2%, you're seeing rents higher.
[47:16] And certainly rents below 1% means it's just a terrible shortage of rental properties.
[47:21] But we all know that.
[47:22] I mean, it's a truism.
[47:23] It's a rental crisis.
[47:25] We still call that.
[47:26] But we're just seeing at the moment, after having rents rise earlier in the year, middle of the year, autumn,
[47:33] They've now just started to ease a little bit.
[47:36] I'm not sure this is a trend going forward, but we need to watch out what's going to happen over the next couple of months.
[47:43] Of course, you know, we've got these policies, which I don't think have impacted the market yet, to have fewer rental properties, you know, going forward.
[47:51] So that actually should put upward pressure on rents, not lower pressure on rents.
[47:55] So we'll just see how that goes.
[47:57] Pans out.
[47:58] Building approvals, just quickly with building approvals, which are quite volatile.
[48:04] When we look at the monthly figure, overall down 2.7%.
[48:07] Houses were down and units were down.
[48:10] But the year-to-date is interesting.
[48:11] We can see there's been a big rise in the year so far to July compared to the same period last year.
[48:17] Big rise in houses, not so much for units.
[48:20] But when we look on the year-on-year comparisons, we can see units are still ahead of houses in terms of building approvals.
[48:27] And that's because there was a big surge, particularly in Sydney and Melbourne last year for units.
[48:32] But that's sort of washed its way through the system now.
[48:35] And we're not seeing the same number of units being approved.
[48:38] But we are starting to see a real pickup in houses, which is quite interesting.
[48:42] But at the end of the day, when we look at the trends, you can see the trend there for capital city building approvals.
[48:48] They're higher than where we were before.
[48:49] a year ago, but it's not a real breakout in terms of the number of building approvals, and it's still basically flatlining.
[48:57] How long does it generally take?
[48:59] Building approval and having the house are two different things, right?
[49:01] That's right.
[49:02] How long does it take for building approvals?
[49:03] About nine months.
[49:05] Yeah.
[49:05] It's like two or three years for a unit, and that's the point.
[49:08] We had a big surge in unit approvals last year, but they're not going to become live-in houses really, not for...
[49:13] maybe next year or even the year after, all those approvals we got, which were fast-tracked by Melbourne and Sydney.
[49:19] But it's much more, you know, closer to becoming a house, you know, a liveable house, a house approval than a unit.
[49:29] But certainly there's been a big pick-up in building approvals for houses, whereas the office, there's been a big reduction in building approvals for units compared to the same period last year.
[49:40] But the whole point is it's just like really going nowhere in terms of resupplying our housing market with housing.
[49:53] We're still under supply.
[49:55] And when we look at the breakdowns, it's quite interesting.
[49:57] You can see Sydney and Melbourne as this year so far compared to the same period last year are underperforming in terms of unit approvals, Sydney unit house approvals,
[50:07] And Brisbane and Adelaide and particularly Perth, very strong building approvals for houses, whereas units with the exception of Brisbane are underperforming.
[50:18] But Brisbane is just on fire in terms of building approvals
[50:22] And that's only counting Brisbane as the capital city?
[50:25] Yeah, capital city.
[50:25] That doesn't take any Gold Coast running into account?
[50:28] But, you know, all South East Queensland is a building site at the moment for housing.
[50:33] But as I said, very strong results in Brisbane, and they're very proactive now in the Brisbane government in terms of building approvals.
[50:41] And you can see that in the data because it's leading the charge.
[50:45] It's huge, 62.3% for units in Brisbane as opposed to everything, which is no higher than 20%.
[50:50] Yeah, that's right.
[50:51] Well, that's housing too.
[50:53] Yeah, that's the seven months this year compared to the same month last year.
[50:58] So it's leading the charge everywhere.
[50:59] Significantly.
[51:01] And that might be helping to bring more supply into the Brisbane unit market.
[51:08] particularly, and we've seen that just easing off a bit, but I wouldn't suggest that's got anything to do with supply.
[51:13] It's more about interest rates going forward.
[51:16] So let's just finish off, Sam.
[51:17] It's been a long journey today.
[51:21] Play on.
[51:21] That's right, mate.
[51:22] Thanks.
[51:23] So what we always do is to tell us what's happening in real time, and we've looked at prices in real time, but the real, real-time insight into the housing market is the auction market, right?
[51:36] Because every week we produce auction results, right?
[51:40] And they're a really great forward indicator as to what's really happening in real time in terms of housing market activity.
[51:48] So let's have a look at a snapshot of the monthly clearance rates for the auction markets, the capital city auction markets.
[51:57] And this really does give us some early signs of a revival, which we would expect in spring anyway.
[52:04] So we can see there that the national results, but particularly when we look at the capital city results,
[52:09] Sydney, Melbourne, Brisbane, Adelaide, not so much, and Canberra are all performing better than they did the previous month, which was August, in terms of the clearance rates to date to that month.
[52:25] Clearance rates meaning they're actually selling at the auction.
[52:28] Yeah, selling at auction.
[52:29] Yeah.
[52:29] So this is what we would expect in September.
[52:32] We would expect a better market result.
[52:35] People come into the market.
[52:38] Spring is the auction, the time for auctions.
[52:41] But let's be clear.
[52:42] These are low numbers still.
[52:44] They're better, but they're still low generally.
[52:48] And the real interesting thing here is Melbourne.
[52:52] If you look at Melbourne then, that's the top right-hand corner, Melbourne, like the rest, is certainly upwards in terms of the monthly change in auction clearance rates, but it's performing better, Melbourne, in terms of the monthly clearance rates than it did way back in February.
[53:09] So this again is a bit more of a surprise with Melbourne, which is the auction capital of Australia, capital city, capital of Australia, but...
[53:18] But it's certainly performing quite well, Melbourne clearance rates.
[53:25] Looks pretty consistent.
[53:26] Yeah.
[53:27] Through the entire year.
[53:28] Prices start to be higher once clearance rates get to, let's say, at least 65%.
[53:37] So we need a 65% clearance rate to start saying we're getting higher prices, right?
[53:42] So we're still in a lower price environment.
[53:45] Now, certainly when we're in the 50s, we're expecting lower prices, right?
[53:50] Or certain, you know...
[53:51] Sydney may be moderate, even prices, but the others you would expect lower prices.
[53:56] So that just means that obviously they get to the auction, people aren't meeting the price that the buyer, other sellers are doing.
[54:03] There's not enough buyers.
[54:05] There's just not enough people there.
[54:07] Now, the other thing that's important is that we're seeing very low numbers of properties coming into the auction market.
[54:13] So even though we're getting a decent clearance rate in Melbourne, the numbers of properties going under the hammer are much lower than where they were a year ago, right?
[54:24] We normally have the week before the grand final in Melbourne is what's being usually called the Super Saturday, the first Super Saturday of the year, right?
[54:32] It's called a Super Saturday.
[54:34] The first spring Super Saturday of the year is the weekend before the AFL grand final, right?
[54:43] Because agents avoid the clash with the grand final because people aren't interested in doing anything.
[54:48] They're watching the hoodie, right?
[54:50] And it's not just Melbourne.
[54:51] It's also the other capitals as well to some degree, certainly not as much in Sydney or Brisbane, but certainly to some degree.
[54:58] They all avoid that grand final weekend.
[55:01] So there's a front-end loading of all these auction properties that come into the market, right?
[55:07] And that's why it's called the first Super Saturday of the spring selling season.
[55:11] Now, Melbourne had around about 1,000 auctions for that Super Saturday, but a year ago it was like 1,400.
[55:18] So the numbers, even though they're bigger than they have been for a while, are not anywhere near what we normally have in that first Super Saturday for the year.
[55:26] But there's certainly, without a doubt, better results coming in September so far compared to August in most capital city markets, and the Melbourne market in particular is looking reasonable.
[55:41] Right?
[55:41] We need to get a 65 before we can start saying this is becoming a bit more of a seller's market, but it's certainly a buyer's market now because buyers are holding the whip hand, right?
[55:52] And even though those clearance rates are better, the numbers of properties coming into the market is quite low compared to a year ago, which was a boom.
[56:01] And there were lots of properties coming in because it was a great time to sell a property because people were climbing over each other.
[56:06] So I think that's a good, you know, sort of...
[56:10] indicator for us in September to look at really how the market's going, right?
[56:16] So we need to watch next month.
[56:18] But, of course, the big asset test comes with the Reserve Bank meeting.
[56:23] And next month, Sam, we will be discussing, you know, what's happened as a result of that interest rate meeting and the consequences of the market.
[56:32] And when is that next one again?
[56:33] End of September.
[56:34] End of September.
[56:35] Yeah.
[56:35] So I've just missed out on our September report, but certainly we'll be able to talk about that at some length.
[56:41] And it'll be interesting to see.
[56:42] They might not raise.
[56:44] they might not raise.
[56:45] But certainly most commentators are saying they will raise.
[56:48] And what they said at the last meeting was, hey, we're really worried about inflation.
[56:54] And they didn't raise.
[56:55] So maybe they should have, but maybe they shouldn't have.
[56:59] So if anybody wants to get a copy of that fantastic slide deck, they can take a QR code of that and they'll get a PDF copy going forward.
[57:07] So look, it's been an interesting year, of course.
[57:09] And as we said, everything changes.
[57:11] We've had a lot of left field issues coming through.
[57:14] And it's not just the Iran-US issue with oil, but it's also a number of policy changes with our government.
[57:22] You know, the changes to tax policies and, of course, changes to migration as well that are impacting the market.
[57:30] But, hey, we're in this period now.
[57:32] This is the decline cycle, the easing cycle.
[57:37] And now we need to wait on trying to see some, you know, whether the normal revival in the market will occur potentially.
[57:45] despite the fact of getting perhaps higher interest rates before that occurs.
[57:50] But we can still point to what happened just three years ago in terms of interest rates and house prices.
[57:58] And I think that's a really good indication of what's maybe likely to happen going forward.
[58:03] So everybody out there waiting bated breath for our next exciting episode of our podcast.
[58:09] What do you think?
[58:11] Buddy, fantastic.
[58:12] Got you, mate?
[58:12] That's awesome, mate.
[58:13] Thank you, Doc.

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