Price Trend Line = Houses v Units 

The graphs above represent a trend line of the median price performance at capital city level. Source = CoreLogic.  Note the above graphs don’t represent ‘prices’ but show ‘price changes’ over time.

Houses –  While we’re not seeing massive leaps in prices in each main area (apart from one location) each market is moving up consistently.  The past three months have seen national house values rise by 1.9%, adding approximately $16,700 to the median value.  One look at the graph and you can see the outlier – Darwin 🙄.  There’s literally no solid driver for the market bump apart from bargain buyers hunting there – so this price blip isn’t sustainable.  Across the board we’re seeing very strong buyer demand so the market is set to ignite for Spring.

Units – Looking at the graph you can see a very similar story to match the house trends.  Brisbane, Perth and Adelaide coming in with continued increases of around 3%, while Sydney, Melbourne, Hobart and Canberra have a minor increase.  And Darwin standing out with the largest increase in prices.  Cotality points out the gap between houses and units is increasing – currently around 32% - though I would say again this is due to the lowered interest in one and two bedroom dwellings.  If the developers could get their act together and supply three bedroom units you would see this trend change quickly. 

FORECAST -  Absolutely no doubt about a hugely active Spring, particularly as another interest rate drop is expected.  We have just come through a period of six months with small national increases, but with drastically low supply of property during Winter there is a bigger group of buyers preparing to take action once the RBA makes their this month. Agents, property stagers and photographers are reporting an increase in owners prepping to put their property on the market so maybe we will see a decent increase in supply.  As always, if you’re planning to purchase please ensure you have your finance organised as the competition will be hot.

Rents - Houses v Units

Once again, please note the graphs below show ‘price changes’ not actual pricing [ eg – even though Perth looks to be ‘on top’ this means it’s increasing faster than other locations, not that it’s more expensive.]  Overall rents look to be stabilising.  As we edge towards the end of the year, we definitely have a trend of stabilisation or very minimal change in the levels of rental returns.  If we can start to make a dent on supply, rents could relax further however this isn't expected to occur in the short term.

Vacancy Rate

This data is drawn from SQM Research.  It represents the total vacancy rate in each major city.  A ‘healthy’ rate is around 2.5%. Anything below this means the amount of properties available for rent is not sufficient to meet the amount of people who want to rent in that particular area.  As you can see, all areas of Australia need more rental properties (all areas are under 2%), although supply is getting closer to healthier levels in Melbourne and Canberra. 

Employment levels are an important indicator of economic health, and something the RBA monitors closely when deciding what to do with interest rates.  This information should also be monitored by property buyers as a leading indicator of locations to avoid or consider for their next purchase. 

The sweet spot for a good level of unemployment – where there’s enough jobs for those who want them - will hover between 4 and 5% depending on the rate of jobs turning over.

Anything below 4% would be considered to be low unemployment and would suggest a strong jobs market, attracting workers which increases demand for housing and pushes capital growth and rental returns upwards.

Anything in the 4.5% and upwards would reflect high unemployment which will indicate economic struggles, leading to weaker property price growth and eventually declines.

Population Growth 

This graph shows the change in population by State over the last reporting period.  The data includes changes caused by both overseas migration and also where Australians are moving from one state to the other.  Overall Australia had 667,000 migrant arrivals in 2023 -2024, a slight decrease over the previous 2022-2023 year of 739,000.

Building Approvals

The graphs below show the monthly dwellings approved in each State and Australia-wide, and also the percentage change.  In 2024, the Australian Federal Government announced a target of delivering 1,200,000 homes by 2029 and to achieve this we need to build 240,000 dwellings (houses and units) per year.  As you can see, we’re falling drastically behind on this target.

RBA Cash Rate (Interest Rate)

3.85%

Australian Dollar

1 AUD = 0.65 USD

Dwelling Values Trend Line

The graph above shows the price trend line for houses and units combined – referred to as the ‘dwellings’ line.  While this information is useful, it’s important to remember to look at pricing at suburb level and review pricing for your specific property type in order to identify opportunities and know what price to offer for your next purchase.

Looking at the combined dwellings data, every capital city recorded a rise in value through the past  month, led by Darwin with a solid 2.2% rise, followed by Perth, up 0.9%. At the softer end of the growth tables are Hobart (+0.1%), Melbourne (+0.4%) and the ACT {+0.5%).  This means dwelling values have increased by 3.7 over the past 12 months.

FORECAST : From an ‘outlook’ / what’s next perspective – there’s now no doubt we’re seeing a trend shift upwards.  The next RBA announcement is expected to see the cash rate reduced. If you’re planning to buy property within the next six months, you should ensure you have your finances ready to go as buyers will need to be nimble to beat the competition during the Spring market.  It’s still too early to see reasonable changes in Melbourne so we’re not recommending this as a good opportunity yet, and we would recommend continuing to avoid Canberra, Hobart, Adelaide and Darwin.  Of course, where you buy depends an your personal requirements as well as what’s happening in the market so book in for a strategy session if you would like more tailored, personal recommendations.

If you’re looking for a more detailed review of the market, check out the information below.