Looking into 2024, the Australian property market is poised for strong growth, influenced by several key factors. Our population growth, the increasing wealth of our nation, and falling interest rates over the years (excluding the past couple of years) have driven up property values.
However, we are still facing several challenges:
- Inflation Control: While inflation is managed, it remains relatively high, impacting the economy and property market.
- Interest Rates: Hopefully interest rates have reached their peak, but they are still higher than previous years.
- Wage Growth-v-Inflation: Wages are not keeping pace with inflation, affecting purchasing power.
- Borrowing Challenges: Banks’ stringent borrowing criteria, including adding 3% to current interest rates for loan assessments, affect market dynamics.
Despite these economic challenges, several growth drivers are likely to fuel the property market in 2024:
1. Surging Migration: Creates unprecedented demand for housing.
2. Limited New Building: Constrains supply, pushing up prices for new constructions.
3. Strong Economy: Australia’s robust economy and low unemployment rates bolster the market.
4. Government Spending: Federal and State initiatives and infrastructure projects stimulate growth.
5. Low Property Stock: Fewer properties for sale lead to competitive markets.
6. Low Vacancy and High Rents: Drive demand for property investment.
7. Interest Rate Stability: The belief that interest rates have peaked or are close to it adds market confidence.
8. International Demand: A resurgence in international interest in Australian properties.
These factors indicate a significant opportunity for the well informed at the early stages of this new property cycle.
Both buyers and sellers are active, with property values showing steady increases and a noticeable fear of missing out (FOMO) effect in some areas and specific properties types.
Buyers are increasingly valuing properties with lifestyle appeal, space, and security in liveable locations which typifies our beautiful Redlands.
With the media reporting rising auction clearance rates and increasing consumer confidence, a new group of buyers assured by the strengthening economy and growing employment will potentially enter the property market.
This will not only absorb more of the current stock but will also increase competition for properties which will drive up prices. For those prepared and informed, this period presents a strategic opportunity.
In summary, the property market’s future looks robust, with multiple growth drivers set to propel values in 2024.
Remember, if you need any help or advice, I am just a phone call away.
All the best, Simon Salm
To view our current listings for sale, click HERE