PEXA report indicates a shift back towards urban living
Residential property transactions in Australia’s mainland states saw a significant shift in financial year (FY) 2024, with metropolitan areas outpacing regional counterparts, according to the latest PEXA Property Insights report.
The report noted a total of 663,158 residential property settlements in FY 2024, marking a 5.5% increase from FY 2023. Residential property market spending surged to $585.6 billion, up 12.6% year-on-year. However, the commercial property sector faced a 3.2% decline in settlement numbers, reflecting market complexities and subdued investor sentiment.
Queensland led the residential property market in FY 2024 with 180,462 transactions, followed by New South Wales (177,656) and Victoria (172,902). The eastern states also recorded the highest sales values, with NSW at $215.5 billion, VIC at $142 billion, and QLD at $137.6 billion.
Julie Toth (pictured above), chief economist at PEXA Group, highlighted the rise in metropolitan settlements driven by sales activity in expanding outer suburbs, where buyers seek affordable properties within commuting distance of key amenities.
“Greater Sydney and Greater Melbourne saw substantial growth in property transactions in FY24, with increases of 16.1% and 8.6% respectively,” Toth said. “In contrast, regional markets in the same states experienced modest gains or declines, indicating a shift back towards urban living. Sales in regional NSW grew by just 1.1%, while regional VIC declined by 5.9%.”
Suburbs like Tarneit stood out, with the highest settlement number nationwide at 5,906 sales. Other high-ranking city suburbs, including Marsden Park, Craigieburn, and Ripley, continued to attract significant interest due to their large-scale greenfield housing developments.
“Our newer urban areas are driving market growth, but this growth is constrained by logistical and financial realities,” Toth said. “New dwelling approvals, high interest rates, elevated construction costs, and prolonged construction timelines are limiting the pace of new supply, even as demand intensifies.
“This is placing upward pressure on prices and rents for existing homes. Australia will continue to face housing availability and affordability challenges until we can achieve a better balance between demand and supply.”
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