Spanish house sales fell 7.1 percent year-on-year in April to 55,802 units after a 39 percent fall in March, the National Statistics Institute (INE) reported. Government data also showed a 13.8 percent year-on-year fall in April house mortgage lending to 12.24 billion euros ($19.2 billion), following a 42 percent drop in house mortgage lending in March. April’s lower rate of falls in house mortgage lending and house sales can be partly explained by the fact that Easter was in March this year and in April last year, INE noted.

“This sudden easing is probably due to Easter, and until we see how the index behaves over the next few months we really can’t draw any conclusions,” said Sergio Diaz from Caja Madrid.

Spain, the euro zone’s fourth-largest economy, is suffering a deeper than expected slowdown as the end of a decade-long property boom coincides with the global credit crunch, record oil prices and a strong euro. Housing Minister Beatriz Corredor said on Wednesday the sharp slowdown in Spain’s housing sector will be over by the second half of 2009 and called the sector’s decline a necessary correction for Spain, where house prices tripled in the decade to 2007.

The average Canadian weekly earnings of employees stood at $789.99 in April, up 0.3 percent from March. Compared with a year earlier, average weekly earnings were up 3.2 percent.

In Canada’s largest industrial sectors, earnings rose 4.0 percent in health and social assistance, 3.0 percent in manufacturing, 2.7 percent in retail trade, and 1.9 percent in educational services compared with a year earlier.

Alberta and Saskatchewan had the strongest year-over-year earnings growth of all provinces at 6.0 percent and 5.4 percent respectively.

The average hourly earnings for hourly paid employees edged up from $19.82 in March to $19.85 in April.

Canadian Average Weekly Earnings By Province
April 2008

Canadian Average Weekly Earnings By Industry
April 2008

exchange rate used $1.00 CAN = £0.492

American existing-home sales increased in May with buyers responding to lower home prices, according to the National Association of Realtors.

Existing-home sales – including single-family, townhouses, condominiums and co-ops – increased 2.0 percent to a seasonally adjusted annual rate of 4.99 million units in May but are 15.9 percent below the 5.93 million-unit pace in May 2007.

NAR President Richard F. Gaylord, a broker with RE/MAX Real Estate, said buyers are seeing value in the current housing market. “Home buyers are starting to get off the fence and into the market, drawn by drops in home prices in many areas and armed with greater access to affordable mortgages,” he said. “Today’s buyer plans to stay in a home for 10 years, which is a good strategy for building long-term wealth.”

The American median existing-home price for all housing types was $208,600 (£104,900) in May, down 6.3 percent from a year ago when the median was $222,700 (£112,100).

Lawrence Yun, NAR chief economist, said there’s still a lot of inventory in the market. “The large supply of homes on the market clearly favours buyers, and it should take several months to draw the inventory down,” he said. “Stabilisation in home prices can only occur with buyers returning to the market, so we are encouraged by rising home sales, particularly in distressed markets. Foreclosures and short sales appear to be a larger part of the market, particularly in California, and are creating a drag on current home prices.”

Total housing inventory at the end of May fell 1.4 percent to 4.49 million existing homes available for sale, which represents a 10.8-month supply at the current sales pace, down from a 11.2-month supply in April.

Although conditions remain mixed around the United States, unpublished snapshot data shows a number of areas are experiencing much higher sales activity than May 2007, including Sacramento, the San Fernando Valley and Monterey County in California; Sarasota, Florida; and Battle Creek, Michigan.

“Keep in mind that the volume of home sales is the primary driver of economic activity that is tied to housing,” Yun said. “It’d be premature to say the improvement marks a turnaround. The market is fragile, so a first-time home buyer tax credit and a permanent raise in loan limits would be important steps to get the housing engine humming.”

Single-family home sales rose 1.6 percent to a seasonally adjusted annual rate of 4.41 million in May from 4.34 million in April, but are 14.5 percent below the 5.16 million-unit pace in May 2007. The median existing single-family home price was $206,700 (£103,400) in May, which is 6.8 percent below a year ago.

Existing condominium and co-op sales increased 5.5 percent to a seasonally adjusted annual rate of 580,000 units in May from 550,000 in April, but are 24.6 percent lower than the 769,000-unit level a year ago. The median existing condo price was $223,400 (£112,400) in May, down 2.1 percent from May 2007.

Midwest
Existing-home sales in the Midwest rose 5.5 percent in May to a pace of 1.16 million but are 16.5 percent lower than a year ago. The median price in the Midwest was $165,300 (£83,100), which is 0.7 percent below May 2007.

Northeast
In the Northeast, existing-home sales rose 4.6 percent to an annual rate of 910,000 in May, but are 15.0 percent below May 2007. The median price in the Northeast was $278,000 (£139,800), down 2.4 percent from a year ago.

West
Existing-home sales in the West increased 2.0 percent to an annual pace of 1.02 million in May, but are 12.8 percent below a year ago. The median price in the West was $286,600 (£144,200), which is 16.0 percent lower than May 2007.

South
In the South, existing-home sales slipped 0.5 percent to an annual rate of 1.91 million in May, and are 17.0 percent below May 2007. The median price in the South was $175,000 (£88,000), down 4.3 percent from May 2007.

The Adelaide rental market has stabilised a little going into the winter months with a vacancy rate of 1.68 percent for the month of May, the Real Estate Institute of SA (REISA) said today. REISA President, Robin Turner, said April’s lower-than-expected vacancy had predictably balanced out in May with supply marginally exceeding demand.

“Anecdotal evidence from property managers out in the field states tenants are being more selective in their search for properties as the market eases for winter,” Mr Turner said. “This is forcing some landlords to reassess their asking price at a time when they are least keen to do so, as interest rates sit at decade-long highs.”

Mr Turner said Adelaide’s median rental price for houses was $265 per week so anything around this mark was more highly sought after.

“Suburbs to the north and south of the city have retained their low vacancy this month due to their affordability, and the significant transport infrastructure announcements in these areas in the recent State Budget are good news for the long-term sustainability of these regions.”

The REISA vacancy rate survey is broken down into six main areas. The parameters and statistics for May 2008 were:

• City – All city and North Adelaide only – 2.23%
• West – Suburbs west of West Terrace, between Port Road and Anzac Highway *excluding Glenelg suburbs – 2.04%
• South – Suburbs south of South Terrace, between Glen Osmond Road and Anzac Highway *including Glenelg suburbs – 1.39%
• East – Suburbs east of the city square, between Payneham and Glen Osmond Roads, excluding the Hills area – 2.08%
• North – Suburbs north of North Adelaide, between Port and Payneham Roads, turning into Lower North East Road – 1.41%
• Hills – Suburbs from Crafers to Nairne – 0.00%

Half a million British ex-pats living in Costa Blanca in Spain are to lose their free healthcare under a new law being introduced by the region’s provincial government.

The Spanish authorities say that British expatriates living in the Valencia region, most of whom are over 50, are placing a too high a burden on the local health service. A spokesman for the regional health ministry said: ‘It is costing us an extra €1bn [£790m] annually to look after a million new residents as well as long-stay tourists, and our services are at saturation point.’

The move has caused alarm in the expatriate community on the Mediterranean coast. Many made the move to Spain on retirement under the impression that they would be looked after by the medical system there but now they are being coerced into taking out expensive private insurance.

A British embassy spokesman said UK pensioners and individuals on long-term incapacity benefit who are living permanently in Spain would be unaffected, as they are covered under a reciprocal healthcare agreement with the UK. Those who will lose their entitlement - mainly early retirees aged over 50 - were being advised to take out private health insurance.

Following two months of small increases, Canadian employment was unchanged in May, and the unemployment rate remained at 6.1%. Over the past 12 months, figures from Statistics Canada show that employment in Canada has risen by 2.0 percent. Despite slower employment growth in recent months, the participation rate remained at its record high of 68.0 percent in May.

Manufacturing employment rose in May, mainly in Ontario and Quebec. Employment across Canada in this industry has trended downward since November 2002. Health care and social assistance, as well as “other services” added employment in May, while agriculture and professional, scientific and technical services recorded losses.

Quebec
In Quebec, after two consecutive months of declines, employment rose by 18,000 in May. With an increase in the number of Quebecers in the labour market, the unemployment rate was little changed at 7.5 percent. Employment growth over the last 12 months in the province stands at 1.2 percent, below the national rate of growth.

Employment in Quebec’s manufacturing industry increased in May (+14,000). While manufacturing employment has declined by 124,000 since November 2002, over the past 12 months, this sector has been stable with growth in transportation equipment offsetting losses in textile and clothing manufacturing.

With a slight increase in May, Ontario’s employment growth over the past 12 months was 2.2 percent. Losses in educational services in May were offset by gains in manufacturing.

Newfoundland & Labrador
In Newfoundland and Labrador, the employment rate rose to an all-time high of 52.8 percent in May. Over the past 12 months, employment growth was 2.9 percent, one of the fastest rates of growth in the country.

Manitoba
Following strong gains the month before, employment in Manitoba declined in May, pushing the unemployment rate up to 4.2 percent, still among the lowest in Canada. Employment in this province has increased by 1.5 percent in the past 12 months.

New Brunswick
In May, employment in New Brunswick declined (-4,400), bringing the unemployment rate up to 8.9 percent. In 2007, employment followed an upward trend; so far this year, however, growth has slowed.

Alberta
Although unchanged in May, employment in Alberta has increased 3.3 percent over the past 12 months, the strongest growth rate in Canada. As a result of increased participation in the labour market, the unemployment rate rose in May to 3.6 percent, still the lowest in Canada.

Strong employment growth for adult women
In May, employment among adult women rose by 35,000, mostly in part time. An increase of 52,000 women in the labour market boosted their participation rate to an all-time high of 62.4 percent in May.

The total number of jobs advertised in major Australian newspapers and on the internet fell by 1.7 percent in May to a weekly average of 270,751 per week. This follows a 3.1 percent increase in April. The total number of ads in May was 9.5 percent higher than 12 months ago. In trend terms the total number of job ads was static.

Looking at the different channels for advertising jobs, the number of job ads in major Australian newspapers decreased by 13.5 percent in May to an average of 17,196 per week, the largest monthly decline in almost eight years. This followed a 16.1 percent increase in April. Newspaper ads are now 16.0 percent lower than in May 2007. In trend terms, the number of newspaper job ads fell by 1.9 percent to be 11.5 percent lower than a year ago. The fall in newspaper job ads in May was driven by decreases in every state.

In seasonally adjusted terms, newspaper job ads have been unusually volatile in the last few months. However, in trend terms we have seen modest declines in each of the last eight months.

The number of internet job ads fell by 0.7 percent in May to average 253,554 per week. In trend terms, the rate of growth in internet job ads continued to slow, growing a modest 0.2 percent in May and 16.1 percent over the past year.

ANZ Co-Head of Australian Economics Sally Auld, said: “Total job advertisements have fallen in May, although this followed a rise in April. This is consistent with our view that job advertisements have plateaued in the first half of this year. In trend terms we are seeing a loss of momentum in job advertisement growth. This indicates that we may see a modest slowdown in monthly employment growth in coming months.”
“While the slowing in job advertisements growth is consistent with some of the weaker partial activity data we have seen across the economy in recent months, we think this reflects caution on the part of employers about hiring new staff. Tighter credit conditions and uncertainty about the global economic outlook may also be negatively impacting business hiring intentions.”

Quotable Value has released May’s figures for the New Zealand’s housing market. The average sale price of a house in New Zealand has decreased slightly to $387,299 (£150,700) from April’s $388,465 (£151,154). Property values have increased 2.4% over the calander year. New Zealand’s average house prices are not directly comparable with the UK’s because, unlike the UK, the average home in New Zealand is a detached bungalow.

QV spokesperson Mark Dow said:

While most areas are still holding their value from a year ago, some areas are beginning to report small declines. Whether properties are holding their value or being sold beneath previous expectations is being influenced by how much pressure the owner feels to sell. There are increasing reports that where sellers aren’t under financial pressure or needing to relocate, they are choosing to take their properties off the market or rent them out rather than accept lower offer.

House Prices in New Zealand
Three Months Ending May 2008

* Assumed exchange rate is £1 = NZ$2.57

European cities dominated annual world-wide quality of living rankings in a survey released today. Zurich scored highest place for overall quality of living and Luxembourg ranked the highest city for personal safety.

European cities dominated the world-wide rankings of locations with the best quality of living, according to Mercer’s 2008 Quality of Living survey. The quality of living survey covered 215 cities and was conducted to help governments and major companies place employees on international assignments. Zurich retained its 2007 title as the highest ranked city, followed jointly by Vienna and Geneva. Vancouver was 4th followed by Auckland in 5th place.

The survey also identified those cities with the highest personal safety ranking based on internal stability, crime, effectiveness of law enforcement and relationships with other countries. Luxembourg was top, followed by Bern, Geneva, Helsinki and Zurich, all equally placed at number 2. Chicago, Houston and San Francisco were amongst the safest cities in the US.

North America
Canadian cities dominated the rankings in the Americas. Vancouver (4) had the best quality of living followed by Toronto (15), Ottawa (19) and Montreal (22). In the US, after Honolulu (28) came San Francisco (29), Boston (37) and Chicago (44). Washington, DC, ranked 44, above New York (49).

In terms of personal safety, Canadian cities again performed best with Calgary, Montreal, Ottawa, Toronto and Vancouver all ranked jointly at 22. In the US, Chicago, Honolulu, Houston, Lexington, San Francisco and Winston-Salem all shared rank 53.

Mr Parakatil senior researcher at Mercer said, “Personal safety within Canadian cities ranks among the highest in the region. This is due to a relatively low crime rate and a stable political environment.”

Europe
Switzerland and Germany dominated the European cities with the best quality of living, each having three cities represented in the top 10. Bern, in Switzerland, ranked 9 followed behind Zurich and Geneva. Dusseldorf (6), Munich and Frankfurt (both at 7) represented Germany. Outside the top 10 were Copenhagen (11), Amsterdam (13), Brussels (14), Berlin (16) and Luxembourg (17). Dublin, ranked 25, was followed by Paris (32), Barcelona (42) and Madrid (43). Lisbon was number 44 and was followed by Rome, 55, up from 61 in 2007. Prague (71) was the highest-ranking eastern European city followed by Budapest (74), Vilnius (78), Ljubljana (82) and Warsaw (85).

The rankings of Bern, Geneva and Zurich, all at 2, confirmed Switzerland’s position as one of the safest countries in Europe. According to the index, Luxembourg was the European city with the highest level of personal safety. This was in stark contrast with Moscow, the European city scoring the lowest (196). In the UK, Glasgow (43) and Birmingham (53) ranked safer than London (69).

Mr Parakatil commented, “Europe dominates the list in terms of infrastructure, health and political stability. Large discrepancies continue to exist within this region. Living standards in Eastern European cities have been catching up with Western European cities.”

Asia Pacific
Auckland (5) was the city in Asia Pacific with the best quality of living, followed by Sydney (10) and Wellington (12). Elsewhere in Asia, Singapore (32) ranked two places higher than in 2007, slightly higher than Japanese cities such as Tokyo (35). Hong Kong and Beijing retained their 2007 rankings, respectively 70 and 116 in 2008. Bangalore (140) was India’s most highly ranked city followed closely by Mumbai (142). Both have seen a marked improvement in their rankings since 2007. For personal safety, Auckland (10) and Wellington (10) ranked highest in the Asia pacific region.

American real average weekly rose slightly by 0.3 percent from April 2008 to May 2008 to $604.58 after seasonal adjustment, according to data released by the U.S. Department of Labor. Over the past 12 months, weekly earnings rose by 3.2 percent.

In May, average hourly earnings edged up by 5 cents, or 0.3 percent, to $17.94, seasonally adjusted. This followed gains of 6 cents in March and 2 cents in April.

Data on American average weekly earnings are collected from the payroll reports of private non-farm establishments. Earnings of both full-time and part-time workers holding production or non-supervisory jobs are included.

May 2008 earnings not seasonally adjusted

exchange rate used $1.00 = £0.510

Research commissioned by the Department of Labour has found an association between New Zealanders returning home and local house price increases between 1986 and 2006, but not with new immigrants. The report “Housing Markets and Migration: Evidence from New Zealand” found that while population growth and house prices increased together over the period, there was no evidence to suggest that the arrival of new immigrants had had an impact on local house prices.

It was unclear what was driving the association between returning New Zealanders and house prices, and whether returning New Zealanders had in fact been one of the causes of rising house prices or had more simply moved home to areas that tended to have higher than average price increases.

The research findings indicate that both the flow of migrants - new immigrants and returning New Zealanders - and house prices are affected similarly by other common factors, which could include a strong economy, high income and employment expectations.

Overall, the research found a positive link between population growth and house prices. For example, a one percent increase in an area’s population was associated with a 0.2 to 0.5 percent increase in house prices. The impact on rents was found to be lower.

The report found that recent migrants were more likely to rent homes than the New Zealand-born population, but that longer-term, rent/ownership levels were similar to the New Zealand-born population.

It also found that the capacity of the building industry appeared to be adequate to meet the level of housing demand to 2016, even under a high immigration scenario. Conditions had to be met such as the type of accommodation built needed to change to meet changed demand; there would be a growing demand for private rental market dwellings; and that the proportion of people living in flats or apartments was likely to increase.

The research, carried out by BERL on behalf of the Centre for Housing Research Aotearoa New Zealand (CHRANZ) and the Department of Labour, explored the links between immigration and housing demand and supply. Using census data for 1991, 1996 and 2006 it investigated the past housing behaviours of five types of households: migrant couples, New Zealand-born and migrant couple, New Zealand-born couple, single migrant and New Zealand-born single. Migrant households were further classified as ‘recent’ (fewer than five years), ‘intermediate’ (5-15 years) or ‘earlier’ (15+ years).

Manpower Inc. has released the results of its third annual talent shortage survey, revealing that 31 percent of employers across the globe are finding it more difficult to fill jobs. “This year, the most significant finding is that the percentage of employers in the Americas having trouble filling positions has dropped more than half compared to last year,” said Jeffrey A. Joerres, CEO of Manpower Inc. “This dramatic decrease is a reflection of the recent downturn in the U.S. economy. However, the talent crunch is still a very real concern.”

The top ten workers most in-demand by country are:

United States

1. Engineers
2. Machinists/Machine Operators
3. Skilled Manual Trades (primarily welders or carpenters/joiners)
4. Technicians
5. Sales Representatives
6. Accounting & Finance Staff
7. Mechanics
8. Labourers
9. IT Staff
10. Production Operators

The percentage of employers surveyed in the USA indicating that they are having difficulty filling positions was down from 41% in 2007 to 22% this year.

Canada

1. Skilled Manual Trades (primarily carpenters/jointers, welders or electricians)
2. Sales Representatives
3. Engineers
4. Accounting & Finance Staff
5. Labourers
6. Nurses
7. Teachers
8. Drivers
9. Machinists/Machine Operators
10. Secretaries, PAs, Administrative Assistants & Office Support Staff

The percentage of employers surveyed in Canada indicating that they are having difficulty filling positions was down from 36% in 2007 to 31% this year.

Australia

1. Skilled Manual Trades (primarily electricians, carpenters/joiners, or welders)
2. Engineers
3. Sales Representatives
4. Accounting & Finance Staff
5. Drivers
6. Technicians
7. Labourers
8. Secretaries, PAs, Administrative Assistants & Office Support Staff
9. Mechanics
10. Management/Executives

The percentage of employers surveyed in Australia indicating that they are having difficulty filling positions was down from 61% in 2007 to 52% this year

New Zealand

1. Sales Representatives
2. Skilled Manual Trades (primarily carpenters/joiners or electricians)
3. Engineers
4. Accounting & Finance Staff
5. IT Staff
6. Labourers
7. Technicians
8. Secretaries, PAs, Administrative Assistants & Office Support Staff
9. Management/Executives
10. Production Operators

The percentage of employers surveyed in New Zealand indicating that they are having difficulty filling positions was down from 62% in 2007 to 47% this year

Spain

1. Technicians
2. Skilled Manual Trades (primarily electricians, masons, welders or bricklayers)
3. Management/Executives
4. Accounting & Finance Staff
5. Production Operators
6. Labourers
7. Drivers
8. Secretaries, PAs, Administrative Assistants & Office Support Staff
9. Mechanics
10. Engineers

The percentage of employers surveyed in Spain indicating that they are having difficulty filling positions was down from 33% in 2007 to 27% this year

In 2006, Canada’s homeownership rate reached its highest level since 1971, according to date from the 2006 Census. Of the 12.4 million households in Canada, more than 8.5 million, over two-thirds owned their home, the highest rate since 1971. At the same time, the proportion of Canadian households that rented their home slipped from 34 percent in 2001 to 31 percent in 2006. About 3.9 million households rented their home in 2006.

The increase during the five-year period continues the long-term trend in rising homeownership that picked up in 1991 after a period of low growth during the 1980s.

Households in the Atlantic provinces continued to have the highest homeownership rates in the country in 2006. Those in Newfoundland and Labrador had the highest rate, 79 percent. Households in Quebec had the lowest provincial rate at 60 percent.

The median selling price Canadian homeowners would expect to receive for their dwellings rose from $134,240 in 2001 to $200,474 in 2006, a 49 percent increase. Over the same period, consumer prices as measured by the Consumer Price Index increased by 11.3 percent.

More homeowners with a mortgage
Nearly 6 out of every 10 households that owned their home had a mortgage in 2006. Provincially, Alberta had the highest proportion of households with a mortgage (62%) and Newfoundland and Labrador had the lowest proportion (45%).

Condominiums driving homeownership
The census counted 913,000 households that owned a condominium in 2006, up 37 percent from five years earlier. The increase in condominium owners during this period accounted for one-quarter of the increase in the number of Canadian households that owned their dwelling.

Rates of condominium ownership were highest in the four British Columbia metropolitan areas. Condo owners accounted for 31 percent of owner households in Vancouver in 2006, 24 percent in Abbotsford, 21 percent in Victoria and 21 percent in Kelowna.

Shelter costs increasing faster than the CPI
For renter households, median annual shelter costs rose by 12.8 percent between 2001 and 2006. Over the same period, consumer prices increased by 11.3 percent. For owner households, spending on shelter increased by 21.6 percent, almost twice the increase in consumer prices.

In 2006, the median annual shelter cost for renter households was $8,057. For owner households with a mortgage, it was $15,150.

Percentage spending 30% or more on shelter edges up
In 2006, an estimated 3.0 million households, or 24.9 percent of the total, spent 30 percent or more of their income on shelter. This was up marginally from 24.1 percent in 2001, but was lower than the high of 26.6 percent in 1996 at the end of the economic downturn experienced in the early 1990s.

Renter households had a higher share of households spending 30% or more on shelter — 40.3 percent in 2006, compared with 39.6 percent in 2001.

Homeowners had a lower share at 17.8 percent of these households in 2006, up from 16.0 percent five years earlier.

The majority of recent migrants are finding work in Australia, according to figures released today by the Australian Bureau of Statistics (ABS). Over two-thirds (68%) of recent migrants (those who have arrived in the last ten years) were employed in November 2007, compared to 66% for people born in Australia. Over half (54%) of the migrants who had a job at some time since arriving in Australia already had a job arranged before arrival, or had one within 3 months of arrival.

However, just over one-third (36%) reported some difficulties finding their first job - the most common being ‘lack of Australian work experience or references’, ‘language’, and ‘lack of local contacts and networks’. Migrants from main English-speaking countries were more likely to have a job than those born in other countries (88% compared to 76%).

Of the migrants with permanent residency, most (90%) were between 15 and 44 years old when they arrived in Australia; their main visa types were skilled visa (49%), family visa (37%) and humanitarian visa (12%). For temporary residents, the main visa type was student (57%), followed by business (20%).

Since 1998, a total of 1.1 million people aged 15 years or older have arrived in Australia - or around 7% of Australia’s population aged 15 years and over. Over half (57% or 647,000) of these people have obtained permanent resident status and a quarter (25% or 285,100) were temporary residents who planned to stay in Australia for 12 months or more.

Just under one-third (30%) of recent migrants and temporary residents had obtained Australian citizenship.

Perth’s median house price reached an all time record in December, passing $474,000 at the end of last year according to last minute sales data trickling into the Real Estate Institute of Western Australia. However, official REIWA data for the March quarter shows the Perth median house price has since retracted by around $14,000 to $460,000.

REIWA President Rob Druitt said this correction was just part of the market consolidation phase after the boom of the last few years and that the current market provided real opportunity for buyers.

“There are now almost 18,000 properties on the market and whilst prices have come down the outlook for interest rates and inflation remains uncertain. That said, there are many potential buyers who are waiting and watching for the right time to buy, and now thinking about making their move,” Mr Druitt said.

Mr Druitt said the strong population growth in Western Australia was creating significant pent up demand for housing, with many potential buyers in the market keen to secure a home of their own.

The dip in prices and recent stamp duty cuts announced by the State Treasurer would be a strong impetus for would-be buyers to emerge through the winter.

Rents

“REIWA data are also showing that rents maintained their double digit annual growth during March, to a new median price of $310 per week for units and $335 per week for houses. The upward pressure on rents is also causing many would-be buyers to have another look at purchasing,” Mr Druitt said.

Perth’s tight vacancy rate for rental property continues, but is not as dire as this time last year when it plummeted to 0.8 per cent. The current vacancy rate is 1.4 per cent, although Mr Druitt was confident this would ease over coming months.

“Many investors trying to sell right now will find it difficult with so much competition in the market. So, it seems likely that many owners will decide against selling and instead turn their property over to the rental market for another year or two. This should prove a great boost to the rental system, offering more choice for tenants and helping moderate rent increases,” Mr Druitt said.

Regions

While metropolitan Perth experienced a decline in the March quarter, many regional areas saw good growth and a return of buyer confidence.

“After three quarters of negative growth, the Mandurah-Murray region bounced back with a 6.9 per cent lift, perhaps a reflection of the positive benefits of the new city-link train line.

“Whilst prices have remained stable in Greater Bunbury , Geraldton-Greenough and Kalgoorlie-Boulder’s median house price experienced solid growth of 6 and 11 per cent respectively,” Mr Druitt said.

Summary

Mr Druitt said with the way the June quarter is unfolding he expected further local price corrections as the build up of properties for sale washes through, and that there was likely to be only small gains in overall price through to the end of the year.

“It’s hard to escape the fact that significant pent up demand from buyers is just waiting to be unleashed. A strong economy generating strong population growth means there is increasing numbers of people all needing a place to live. Particularly now that the market is correcting, prices are coming down and affordability is improving despite some uncertainty on interest rates. Coupled with the recently announced stamp duty cuts taking effect in July, we will likely see new buyer activity pick up through late winter and into spring,” Mr Druitt said.