UDIA | URBIS HOME PURCHASER SENTIMENT SURVEY

An Update of Property Sentiment Among Sydney Residents

18 June 2020

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SAMPLE OVERVIEW

Online survey with Sydney residents aged over 21 years.

A total of 531 Sydney residents were surveyed in the period 7-12 May 2020. In July 2019 a total of 540 Sydney residents were surveyed giving a total sample of 1071 residents.

AGE AND HOUSEHOLD PROFILES IN LINE WITH GREATER SYDNEY PROFILES

18/06/2020

0%

5%

10%

15%

20%

25%

21-24 25-34 35-44 45-54 55-64 65+

AGE DISTRIBUTION

2019 2020

Household Composition 2019 2020

Family households with children living at home 49% 45%

Family/couple household with no children at home 29% 33%

Single or lone person households, no children at home 16% 19%

Group share households, no children at home 5% 3%

Parent/(s) and Adult children 1% 1%

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CROSS SECTION OF GEOGRAPHIC REGIONS

REGION 2019 2020

Sydney - City and Inner South 16% 12%

Sydney - Inner South West 12% 12%

Sydney - Inner West 9% 11%

Sydney - North Sydney and Hornsby 9% 10%

Sydney - Parramatta 10% 9%

Sydney - Outer West and Blue Mountains 7% 8%

Sydney - Blacktown 7% 7%

Sydney - Baulkham Hills and Hawkesbury 5% 6%

Sydney - South West 6% 6%

Sydney - Outer South West 4% 6%

Sydney - Eastern Suburbs 5% 5%

Sydney - Ryde 4% 4%

Sydney - Sutherland 4% 4%

Sydney - Northern Beaches 2% 1%

MIX OF TENURE AND HOUSING TYPES

.

18/06/2020

Own outright,

34%

Own with a mortgage, 37%

Rented, 29%

Other, 1%

TENURE TYPE- 2019

Own outright, 33%

Own with a mortgage, 38%

Rented, 28%

Other, 1%

TENURE TYPE- 2020

Separate house, 53%

Semi-detached, row or terrace

house, 13%

Flat or apartment,

33%

Other dwelling type, 1%

DWELLING TYPE- 2019

Separate house, 48%

Semi-detached, row or terrace house, 16%

Flat or apartment,

33%

Other dwelling type, 2%

DWELLING TYPE- 2020

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52% OF RESIDENTS ARE POSITIVE ABOUT IT BEING A GOOD TIME TO PURCHASE IN THE CURRENT MARKET. DOWN FROM 57% IN 2019.

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OVERALL, SHIFTS IN SENTIMENT ARE MODEST SINCE THE LAST SURVEY

6%

11%

25%

31%

27%

6%

13%

28%

31%

21%

0%

5%

10%

15%

20%

25%

30%

35%

Very negative A little negative Neither positive or negative A little positive Very positive

MARKET SENTIMENT

2019 2020

Own Outright/

Mortgage

2019

61%

2020

54%

2019

52%

2020

50%

Rented

ONE IN TEN RESIDENTS IN INNER SOUTH / INNER WEST AND WESTERN SYDNEY FEELING LESS POSITIVE

.

18/06/2020

58%61%

55%

61%

45%

60%

52% 51% 50%48%

0%

10%

20%

30%

40%

50%

60%

70%

City and East Western Sydney North Inner West and SouthWest

Sydney - Sutherland

TOTAL POSITIVE SENTIMENT BY REGION

2019 2020

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ALL HOUSEHOLD TYPES HAVE BEEN IMPACTED

31%

VERY POSITIVE

24%

VERY POSITIVE

19%

VERY POSITIVE

28%

VERY POSITIVE

24%

VERY POSITIVE

25%

VERY POSITIVE

19%

VERY POSITIVE

20%

VERY POSITIVE

22%

VERY POSITIVE

20%

VERY POSITIVE

FAMILY

COUPLES/ SINGLES

GROUP SHARE

OWN OUTRIGHT/

MORTGAGE

RENTED

2019 2020

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WESTPAC SENTIMENT INDEX SHOWED CONFIDENCE REBOUND IN MAY 96.5

88.1

123.2108.2

119.4

72.9

0

20

40

60

80

100

120

140

160

Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20

Westpac Consumer Sentiment Index

Consumer Sentiment Index Time to Buy a Dwelling Index

House Price Expectation Index

Confidence bolstered by key Government announcements

8 May – Prime Minister Morrison announced the 3 Step Framework for a Covid Safe Australia.

10 May – NSW Premier Berejiklian announced easing of restrictions for cafes, restaurants and gatherings.

49% ANTICIPATE PRICES WILL BE LOWER IN 6 MONTHS TIME. OVERALL, PRICE IMPACTS SEEN AS SHORT TERM.

18/06/2020

24%

46%

57%

15%

36%

63%

0%

10%

20%

30%

40%

50%

60%

70%

6 months 12 months 18 months

PRICE WILL INCREASE

2019 2020

54%

36%30%

36% 38%

27%

0%

10%

20%

30%

40%

50%

60%

6 months 12 months 18 months

PRICE WILL REMAIN THE SAME

2019 2020

22%19%

13%

49%

26%

10%

0%

10%

20%

30%

40%

50%

60%

6 months 12 months 18 months

PRICE WILL DECREASE

2019 2020

VAST MAJORITY ANTICIPATE INCREASED PRICES, OR SAME AS TODAY IN 12 MONTHS

18/06/2020

36% 35%

43%

33%37%

39%36%

43%

38%40%

25%

29%

13%

29%

23%

0%

10%

20%

30%

40%

50%

60%

Western Sydney Inner West and SouthWest

Sydney - Sutherland City and East North

12 MONTH PRICE SENTIMENT BY REGION - 2020

Increase Same Decrease

-15%

-7%

+7%

-2%

-16%

+7%

+2%

-12%

-4%

+7%+8%

+5% +4%+6%

+9%

-20%

-15%

-10%

-5%

0%

+5%

+10%

+15%

+20%

Western Sydney Inner West and SouthWest

Sydney - Sutherland City and East North

12 MONTH PRICE SENTIMENT CHANGE BY REGION: 2019-2020

Increase Same Decrease

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OVERALL 18% OF SURVEYED RESIDENTS INDICATED THEY ARE LIKELY TO PURCHASE PROPERTY IN THE NEXT 12 MONTHS.

64% OF RESIDENTS ARE UNLIKELY TO BE PURCHASING, MAJORITY OF WHOM ARE VERY UNLIKELY

18/06/2020

54%

18% 17%

8%3%

72%

11%

45%

19% 18%

11%7%

64%

18%

38%

15%

23%

17%

7%

53%

24%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Very Unlikely Unlikely Neither likely norunlikely

Likely Very Likely TOTAL Unlikely TOTAL Likely

LIKELIHOOD OF PURCHASING A RESIDENTIAL PROPERTY - 2020

6 months 12 months 18 months

+9%

-3% -3% -3%

-1%

+7%

-3%

+6%

+1%

-3%

-5%

+1%

+7%

-4%

+5% +4%

-2%

-3%-4%

+9%

-7%-8%

-6%

-4%

-2%

0%

+2%

+4%

+6%

+8%

+10%

+12%

Very Unlikely Unlikely Neither likely norunlikely

Likely Very Likely TOTAL Unlikely TOTAL Likely

CHANGE IN LIKELIHOOD OF PURCHASING A RESIDNETIAL PROPERTY: 2019-2020

6 months 12 months 18 months

61% PREFER A FREE-STANDING HOUSE, 28% WOULD PREFER TO LIVE IN A ‘NEW’ DWELLING

13%61% 9%11%

17% 3% 2% 3%5%

18/06/2020

Free-standing

Townhouse/Terrace

Apartments < 4 levels

Apartments > 5 levels

New Buildings

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THE PULL FACTOR OF CERTAIN AREAS IN SYDNEY

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22% OF RESIDENTS WHO WERE EITHER CASUALLY OR ACTIVELY SEARCHING PRE-LOCKDOWN PUT THEIR SEARCH ON HOLD.

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32% ARE EITHER CASUALLY OR ACTIVELY SEARCHING FOR PROPERTY

Total

Likelihood to purchase

home

Likelihood to purchase

investment property

I was actively searching for residential property, and

have put the search on hold7% 16% 18%

I was actively searching for residential property, and

continue to search10% 28% 28%

I was casually searching for residential property,

and have put the search on hold15% 22% 27%

I was casually searching for residential property,

and continue to search13% 18% 15%

I was not searching for residential property, and still

am not searching46% 9% 4%

I was not searching for residential property, and now

am searching8% 7% 7%

TOTAL Search on hold, 22%

TOTAL Searching, 32%

TOTAL Not searching, 46%

ENGAGEMENT WITH PURCHASING RESIDENTIAL PROPERTY

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56% OF RESIDENTS WANT TO SEE STAMP DUTY REFORM IN NEW SOUTH WALES.

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34% THINK THE REMOVAL OF STAMP DUTY WILL INCREASE THEIR CONFIDENCE IN THE PROPERTY MARKET

34%

22%

13%

11%

11%

9%

0% 10% 20% 30% 40%

Removal of stamp duty and replacement with annual landtax payment - remove lump sum payment at purchase…

Stamp duty concessions - keep stamp duty with newconcessions such as increased threshold or lower rate

Access to a mortgage protection facility in the event of lossof income due to Covid-19 - support options to assist…

Increase in the number of First Home Loan DepositScheme Places - A Government backed scheme to get…

Expansion of the NSW First Home Owners Grant toestablished properties in addition to new properties

Access to a Government low-deposit and sharedownership scheme - joint ownership of property with…

Interventions by Government to increase confidence

REMOVAL OF STAMP DUTY PREFERRED FOR OWNERS AND FIRST HOME BUYERS

18/06/2020

Total (%)

Tenure How owned previouslyOwn Outright/

Mortgage Rented

Owned

Previously

Not Owned

Previously

Removal of stamp duty and

replacement with annual land tax

payment - remove lump sum

payment at purchase time and

replace with much lower annual land

tax

34% 40% 20% 41% 25%

Stamp duty concessions - keep

stamp duty with new concessions

such as increased threshold or

lower rate

22% 26% 11% 27% 15%

Access to a mortgage protection

facility in the event of loss of income

due to Covid-19 - support options to

assist mortgage holders avoid

default and rep

13% 12% 16% 12% 15%

Increase in the number of First

Home Loan Deposit Scheme Places

- A Government backed scheme to

get first home buyers into a

purchase with as little as 5%

11% 7% 21% 8% 16%

Expansion of the NSW First Home

Owners Grant to established

properties in addition to new

properties

11% 8% 16% 6% 17%

Access to a Government low-

deposit and shared ownership

scheme - joint ownership of property

with Government for a fixed period

9% 6% 17% 7% 11%

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SUMMARY:TOP FIVE SURVEYTAKEOUTS

Moderate decline in sentiment since July 2019

Sentiment around the investment proposition more impacted

Most anticipate short term negative impact on prices

Covid-19 created uncertainty as people withdrew from searching

Strong support for stamp duty reform to improve confidence