Australian Property Market: A Promising Outlook for 2024 Amid Challenges

The Australian property market is poised for a dynamic year in 2024, with experts forecasting significant growth despite various economic challenges. In a comprehensive analysis, Ryan Johnson and Tracey Prisk provide valuable insights into the market trends and predictions for the upcoming year.

Defying Expectations: The 2024 Property Boom

According to Ryan Johnson, the Australian property market is expected to outperform the already impressive growth seen in 2023. Simon Pressley, head of research at Propertyology, predicts a robust increase in house values across various regions, with some areas expecting growth between 13% and 20%. This optimism is based on factors like tight housing supply and strong household financial capacity, which have historically propelled house price growth beyond 8% annually.

Pressley highlights, “The combined sum of all factors produces a net positive result in most years,” emphasizing the resilience of the market despite challenges like rising interest rates and a looming recession.

A Diverse Perspective on Market Forecasts

While Pressley offers an optimistic view, others like CoreLogic’s Tim Lawless paint a more cautious picture. The Australian Financial Review’s 2024 forecast survey suggests more modest gains ranging from 1%-5%. Despite these differing views, Pressley remains confident, stating, “Throughout the last four years, I have consistently pointed out that Australia’s property market strength is underpinned by record low housing supply and the strongest household incomes in 50-years.”

Top Predictions for Regional and Capital Cities

The market outlook for various regions and capital cities in Australia is diverse. Perth is anticipated to be the top-performing capital city with 13%-18% growth, while Sydney and Melbourne are expected to see more modest increases. Pressley’s predictions also highlight the potential in regional locations like Rockhampton, Handorf, and Bunbury, among others.

Challenges and Opportunities: The View from Industry Experts

Tracey Prisk’s article further explores the challenges and opportunities in the 2024 property market. Kate Hill, a buyers’ agent, notes the impact of factors like new overseas migrants and infrastructure expenditure on property prices. She advises potential buyers not to delay their decisions, stating, “Unfortunately, many property buyers stayed on the sidelines last year because of some alarmist predictions that never came to pass — yet again.”

Kevin Brogan, national director at Herron Todd White, emphasizes the importance of interest rates and the impact of overseas migration on the market. Terry Ryder, director at Hotspotting, points out that the shortage of properties for sale and rentals, coupled with high population growth, are key drivers of property price increases.

Conclusion: A Mixed Outlook with Strong Potential

The Australian property market in 2024 presents a complex but promising landscape. While there are challenges like rising interest rates and economic uncertainty, the market’s resilience and the various factors supporting growth paint a positive picture for the year ahead. As Pressley aptly summarizes, the conditions may not be perfect, but the overall outlook is “overwhelmingly positive.”

References:

Ryan Johnson, “Defying pessimists: 2024 property boom to beat 2023” https://www.brokernews.com.au/news/breaking-news/defying-pessimists-2024-property-boom-to-beat-2023-283874.aspx 

Tracey Prisk, “Top property predictions for 2024” https://www.mpamag.com/au/mortgage-industry/industry-trends/top-property-predictions-for-2024/472050