Housing shortage? What do the numbers say?

[keithj]

i also feel that your assumption of 2.8 people per dwelling is overstated considering the recent increase in single person dwellings, smaller families and the elderly staying in their homes for longer.

It's 2.6 and not an assumption, it's an ABS statistic.

The ABS statistic of 2.6 that you're using is what was the case last year. Lizzie & others (inc me) are saying that this year a high proportion of 1 occupant dwellings will be built - they will not house 2.6 people each.

This has been the trend for several years, and consequently densities are decreasing.

People living in caravan parks would add to my argument that there is an oversupply as it draws people out of normal residential homes...at least that's how I see it?

I see the exact opposite ..... people are overcrowded & are forced to move into caravan parks - they'd much rather live in a house.

All the changes in household density are taken into account with average household size...it's varied between 2.5-2.8 over the last 20 years, not enough to make a large change to results.

I disagree ...... the trend in densities is continuing down. Can you amend your spreadsheet to reflect that, instead of sticking with a constant 2.6 which is the current average.

 

[hobo-jo]

2. Land banking has everything to do with this discussion. What do you think a lot of overseas investors are doing? Obviously I don't know the % of people who keep them empty, but it all contributes to the fact that it leaves 1 less house that 'could' be occupied but is not.

4. For the purposes of argument, 'holiday homes' can also be treated as land banking and leaving house vacant (for whatever reason)

Stop embarassing yourself and look up the definition of land banking.

Can you amend your spreadsheet to reflect that, instead of sticking with a constant 2.6 which is the current average.

keithj, I may just do that and take the data back further on the weekend, but thinking about it this.... it would sway the figures more in the oversupply direction as I would be using larger number of residents per household for the earlier years....think about it.

 

[WinstonWolfe]

good to see you making a fair go of analysing this stuff anyways Hobo.
It's a pity the govt doesn't do more of this and help the private sector allocate capital more efficiently. Suppose they have more important things to do though...

Re housing supply, some of the ABS data sets you could use are:
- housing finance commitments 5609 - monthly data.
- building approvals 8731 - monthly data
- dwelling unit commencements 8750 - qtrly data
- dwelling unit completions 8752 - qtrly data

I've never plotted all these on the same chart to see what the correlation and lag is, but would be interesting.

Resident population growth estimates only come out on a qtrly basis (310101), so you have to infer and split the growth if you want to do monthlys.

 

[DeeHwa]

Stop embarassing yourself and look up the definition of land banking.QUOTE]

I know what land banking is, so definitely not embarassing myself there. With or without a house, it is the same, heaps of wealthy people do it, especially in places like Toorak where people buy neighbouring land to demolish their own and rebuild a bigger house, leave it vacant so they don't end up having neighbours, safe haven way of parking cash etc...

 

[lizzie]

regardless of what the figure say, or where the supposed "mystery" empty houses have gone - i'd rather go by what is said/done/seen at the coal face.

as we all know, stats can be made to report anything you want them to and paperwork does not necessarily equal reality.

 

[Aaron Sice]

a point made earlier - but i wanted to repeat - approvals does not equate to building. i personally has 4 townhouses approved in january 2008, but not looking to start building then until later this year. with the really big boys in town the process from approval to building takes even longer - so there is a lag during which population increases.

absolutely. approvals are one thing, but banks aren't financing, so they're not getting built.

 

[hobo-jo]

I know what land banking is, so definitely not embarassing myself there. With or without a house, it is the same, heaps of wealthy people do it, especially in places like Toorak where people buy neighbouring land to demolish their own and rebuild a bigger house, leave it vacant so they don't end up having neighbours, safe haven way of parking cash etc...

Well perhaps you can explain how land banking comes into the equation?
The figures I had posted in the OP relate to housing growth vs population growth...empty land has nothing to do with the stats in this thread.


Thanks WW for the other data sets, I will substitute completed dwellings in place of approvals when I can and see if there is much of a difference.

 

[DeanoC]

infill developments aren't taken into account either.

take one house on large block. put a triplex development on it. that's three houses, not four, because the old was demolished.

if the oversupply were the case, that says that there's a great number of houses across australia sitting empty.

i know there's barely ANY houses in Perth sitting empty....

Dont know about that mate

Rentals under $400 a week in Scarborough. This is a beach side suburb with a major beach, good transport and less than 15km from ther CBD

http://www.realestate.com.au/cgi-bi...header=&c=14521122&s=wa&snf=rbs&tm=1268823867

Rentals under $400 in Morley with 3 beds or more, nice and central, good transport, close to CBD, nice range of houses to choose from

http://www.realestate.com.au/cgi-bi...=any&pxe=400&minbed=3&maxbed=&cat=&o=def&p=30

7% vacancy sounds a bit high, but there is no shortage of rentals

 

[craigb]

i think those numbers are development approvals ie new room , pergola, not just a new home, i could be mistaken , but there are not that many builders and trades to fill all of those contracts if they are all new homes ,
how many blocks were released would be a better comparison ,

 

[Shadow]

Hi,

If vacancy rates are anything to go by and you can roughly accept the figures provided by SQM research then

Perth City Vacancy 7%
Melbourne City 3.4%
Sydney City 3.3%
Brisbane Inner 3.4%

Not the best figures if there is meant to be a rental shortage.

Those are just the city centre (CBD) figures, not the figures for the whole city.

Sydney as a whole is at 1.4%.

http://www.sqmresearch.com.au/graphs/graph_vacancy.php?region=nsw::Sydney&type=c&t=1

 

[redwing]

Thanks Shadow

Here's PERTH

Perth Vacancy Rate

1.7% is much better than the 4% the last time I looked at this site

 

[Player]

Housing shortage to continue...............Ipswich, Melbourne and Sydney top the charts according to HIA


http://www.forsite.com.au/uploads/news/documents/2841-1.pdf

 

[hobo-jo]

Housing shortage to continue...............Ipswich, Melbourne and Sydney top the charts according to HIA
http://www.forsite.com.au/uploads/news/documents/2841-1.pdf

Went looking for the report instead of the headline grab...you have to pay for it: http://economics.hia.com.au/media/1 ERU Publications Brochure 2010.pdf

Anyone here a HIA member and care to expand on how they conclude there is a current 109,000 house shortage? What data set are they using and the methods/analysis to come to this conclusion?

 

[black dragon]

Great debate on the shortage. And for what it is worth, nice to see that it doesn't get personal and abusive on a debate which does have some very strong conflicting views out there.

For me, I cannot get over the simple fact that in NSW, monthly building approvals are lower now than where they were on the early eighties as per the ABS building approvals data.

The early eighties was of course before the time we had proper deregulation of the financial sector and it was also a period of the country just coming out of recession. In NSW, we are currently approving less dwellings now than that time!!!!

Its crazy stuff. And its due to a combination of greater land restrictions, credit restrictions over the past two years and the fact that many developers land banked to the hilt in Sydney/NSW in 2003 - right at the top of the market.

So I am convinced, that in NSW at least, there is an issue. And I am also convinced that since prices have now just broken through those 2003 levels, we will see a BIG uptick in housing construction for this state.

However I am also aware of the following articles


http://www.pe.com/business/local/stories/PE_Biz_D_cbia23.cff1c74.html


http://www.bloomberg.com/apps/news?pid=20601085&sid=aorirJNxUHi0&refer=europe

They each promote the so called housing shortage in London and California just prior to their own house price crashes.

Whatever you may think of the housing shortage, IMO interest rates, the state of the economy and access to credit will always have their overriding influences on the market.

 

[Amadio]

Over way too many years, I've come to the conclusion that those who say that economics is driven by psychology more than numbers are dead right.

I trust very few statistics, especially when there are such conflicting numbers surrounding the same issue - the cries of a housing shortage in the USA just before it crashed are still ringing in my ears.

 

[hobo-jo]

I've updated the table to reflect completions instead of approvals, as some suspected there are less completions than approvals. I have also extended the data back to 1983 (as far back as I can get easy population growth figures) and hopefully made the table a little clearer to read/understand.

I also emailed the ABS to try and get some clarification around student accomodation.

Hi
I am doing some personal research on housing statistics and was wondering whether self contained student accommodation units are considered "dwelling units" (for the purpose of such data sets as dwelling unit completions - 8752). Examples of the accommodation type I am unsure about:

http://www.unihouse.com.au/rundle.htm
http://www.adelaide.edu.au/accommodation/uni/thevillage/

They are self contained units, however the residents are only staying temporarily (e.g. generally max 3 years) while studying.

Any help confirming the status of such accommodation (in the eyes of the ABS) would be greatly appreciated.
Regards

xx

 

[keithj]

I've updated the table to reflect completions instead of approvals, as some suspected there are less completions than approvals.

Consider taking the figures from ABS3236......
Projected number of households in 2011 is 8,755,000 (Table 6.2)
Average Household size in 2011 is 2.5 ppl per household (page 22)

Multiply the 2 together to see how many people are housed in all the households - Answer is 21,887,000 people.


..... but according to the ABS population clock we have 22,294,368 people here when I typed this.

So today there's 406,000 people unhoused.... so at a density of 2.5 ppl/household, we need an extra 162,000 houses....

....and then add another 8% onto that for the extra holiday homes we'll be needing.....

...and remember that we've got another 9 months of popln increase before we get the number of households we can expect in 2011.


We 'll get some better figures on 8 June 2010 when ABS releases Household and Family Projections, Australia, 2006 to 2031.

 

[boz]

I found a table in my computer from a couple of years ago (probably from foundation). Haven't found the total number of dwelling (there is probably a number from 2006 census on abs website).

I also attach the average persons per household ad average number of beds in dwelling (from 2006 ABS census)

 

[hobo-jo]

I spoke with someone from the ABS today:

Student accommodation –

• If just high rise apartments marketed as student accommodation then would be considered a dwelling unit
• If owned by the university and has joint recreational area (but self contained cooking/bathing) then generally not considered dwelling unit
• If owned by the university and is completely self contained (including recreational area, e.g. lounge) then generally considered a dwelling unit

So it does depend on the accommodation type as to whether they are considered a dwelling unit, but I would think that this type of accommodation would at least rule out some of the effect that international students have on the data I've collated, but obviously not all. It would be much too difficult to work out exactly what number should not be counted

As more dire predictions about the state of the housing market emerge from the aftermath of yesterday's Reserve Bank interest rate rise, one respected analyst has warned against taking the word of vested interests.

Terry Ryder, founder of bargain property seeking service hotspotting.com.au, says predictions of a housing shortage are scaremongering "based on rubbery figures", with large developers with plenty of land drip-feeding it to suit themselves
Link

 

[DavidMc]

Hobo-jo

Apparently the HIA also include the # of dwellings required to home our homeless, which isn't correct IMO.

Terry Ryder also thinks the undersupply is exaggerated. He goes into great detail in the latest edition of the Ryder report so I think you're onto something.

From memory he still thinks it's an undersupply, just not as dire as those with vested interests make out to be.

David.