- Rate cut prediction (Source: Sam Alaaeddin)
The Reserve Bank of Australia (RBA) is expected to cut interest rates, with ANZ and CBA predicting the first cut to occur in February. NAB and Westpac forecast the first cut in May. If there are five rate cuts, borrowers could see a decrease of up to $441 per month, but if there are only two cuts, the reduction would be around $182. The RBA is closely monitoring economic data, and the decision will depend on factors such as inflation and labor force statistics. The number of rate cuts is still uncertain, with NAB predicting five cuts and ANZ expecting only two. Borrowers are advised to prepare for any possibility.
- December house price report (Source: Domain)
Annual price increases have slowed to their lowest levels since September 2023, making 2024 the weakest calendar year of growth since 2022. Despite the slowdown, combined capital house and unit prices have continued to rise overall, with house prices extending their growth streak to eight consecutive quarters and unit prices reaching seven. This represents the longest period of uninterrupted quarterly growth since 2012-2015. Changing market dynamics, including weakened demand, the possibility of cash rate cuts, and increased supply, are expected to create a buyer’s market in 2025.
- New policy proposal (Source: Property Buzz)
The Coalition proposes a new policy allowing first-time home buyers to access up to $50,000 from their superannuation for housing deposits, addressing a significant barrier to home ownership for young Australians. The Housing Industry Association (HIA) supports this measure but calls for additional policies to improve housing affordability, including increasing land supply, reducing regulatory costs, and boosting housing supply. The HIA plans to engage with political parties on housing accessibility initiatives.
- Housing crisis (Source: Property Buzz)
The housing industry association in Australia reported that only 180,000 new homes were completed in the past year, falling short of the required 240,000 annual target. The HIA urged political parties to address the housing affordability crisis and invest in infrastructure to support new housing developments. Tax policies and land availability were identified as major factors contributing to the shortfall.
- Brisbane’s real estate (Source: Melinda Jennison)
Brisbane’s real estate market continues to outperform other major Australian cities, with median dwelling values rising by 11.2% annually in 2024. High interstate migration and ongoing supply constraints have contributed to Brisbane’s sustained growth, despite housing affordability challenges and rising construction costs. The city’s rental market remains tight, with a vacancy rate of 1%.
- Rental market (Source: Craig Francis)
The rental market in Australia is experiencing a levelling out after seven years of increases, with rents rising 0.4% in the December quarter of 2024 and 4.8% over the year. However, renters are still facing high rental stress, with 33.0% of income spent on rent, assuming a median household income. The rental crisis is not expected to improve significantly, as the availability of rental accommodation remains low and weekly rents continue to rise. Sydney and Perth have the highest median weekly rents at $773 and $695, respectively. The combined regions have seen stronger rental growth compared to the capitals, with a 6.2% increase over the year. Rental yields have remained steady at 3.7% nationally, but remain below the pre-COVID decade average.
- Australian property market (Source: Craig Francis)
The Australian property market continues to experience an investment boom, with record profits being made by sellers. Investors are increasingly active in the market, with significant growth in loans for new properties and construction in Western Australia and Queensland. However, borrowing capacity for owner-occupiers has been impacted by high interest rates, making it harder to qualify for loans. Meanwhile, Victoria’s investor loan market is weak, but it leads in owner-occupier loan growth. The median nominal gain from resales reached a record high of $295,000, with Brisbane and Sydney being the most profitable regions for sellers.
- National rental market (Source: CoreLogic)
The national rental market has passed the peak of the recent rental boom, with rents increasing 4.8% over the year and affordability becoming a significant issue. Renters spent 33.0% of their annual pre-tax income on median rent, the highest since 2006. The combined regions experienced stronger rental growth than capitals, and Sydney and Melbourne saw the most significant slowdowns. Factors contributing to easing rental growth include changes in supply and demand, with net overseas migration expected to normalize and an increase in investor participation. Across capital cities, Perth had the second-highest median weekly rental value, while Hobart remained the most affordable. Gross rental yields varied across capital cities, with Melbourne and Brisbane seeing changes in yields.
- Queensland’s property market (Source: Brett Warren)
Queensland has become a popular destination for property investors due to several factors, including lower property taxes, interstate migration, regional markets with high yields and affordability, short-term rental opportunities, and infrastructure projects. These factors have led to a significant increase in investor interest, with Queensland surpassing Victoria as the second-largest property investor market in Australia. Investors are attracted to Queensland’s tax policies, population growth, and strong rental markets, making it an appealing location for both long-term and short-term investments.
- Australian population (Source: Joseph Ballota)
Australia’s population has reached 27 million, with 83% of the increase due to net overseas migration and 17% from natural growth. This growth is reshaping cities and regions, bringing economic benefits but also challenges, including housing affordability, infrastructure strain, and an aging population. Policymakers need to address these challenges through strategies like boosting housing supply, investing in infrastructure, supporting families, and considering sustainability.
- Housing shortages in Perth and regional Queensland (Source: Property Buzz)
A new report by InvestorKit identified Perth and regional Queensland as having severe housing shortages, with Fremantle experiencing a 29% drop in homes for sale despite population growth. The study analyzed 330 regions nationwide and found that housing shortages have shifted from major capitals to smaller cities and regional areas. Fremantle, Perth’s Bayswater-Bassendean region, and Joondalup, as well as several areas in regional Queensland, were identified as the most undersupplied markets. The report’s CEO, Arjun Paliwal, called for wide-ranging reforms to address the shortage, including population distribution, better infrastructure services, a more efficient planning system, and a fairer tax system.
- CoreLogic Auction Results (Week ending 12 January 2025)
(Total Auction / Clearance Rate)
– Sydney: 7 / 66.7%
– Melbourne: 12 / 50%
– Brisbane: 9 / 55.6%
– Perth: 5 / 50%
– Canberra: NA / 0%
– Adelaide: 16 / 43.8%
– Tasmania: NA / 0%
– Combined Capitals: 49 / 51.4%
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