Economist reveals outlook for this year
The real estate market in Australia has experienced a slow start in 2024, with national home prices remaining relatively flat, edging up only by a slight 0.02% in January, according to the latest PropTrack report.
“Home price growth has slowed from what we were seeing in the middle of 2023, with national prices relatively unchanged since November,” said Angus Moore (pictured above), PropTrack senior economist.
“Several factors have contributed to the slowdown, including the additional interest rate rise in November and more homes hitting the market in late winter and spring, giving buyers more choice.”
Capital city home prices
Prices across the combined capital cities remained steady in January, recovering from a slight dip in December.
However, the growth rate has decelerated over recent months, with prices stagnant since October. Sydney (-0.04%), Melbourne (-0.09%), Adelaide (-0.13%), and Canberra (-0.13%) experienced slight declines, while Hobart (0.09%) and Brisbane (0.17%) saw modest growth. Perth stood out as the only city with notable monthly growth, recording a 0.5% increase in January.
Home prices in regional markets
Most regional areas witnessed modest price increases. Regional South Australia (+0.24%) and Western Australia (+0.25%) led in growth. Regional New South Wales (+0.21%) continued its trend of modest monthly growth, while regional Victoria observed a small increase in prices (+0.06%), maintaining stability since September. However, regional Queensland experienced a decline of 0.2%, following robust growth in preceding months.
“Regional areas have very slightly outpaced capital cities over the past few months,” Moore said. “Even so, capital city areas remain the stronger performer over the past year.”
Affordability concerns and outlook for 2024
The PropTrack report acknowledged strained affordability, reaching its lowest level in at least 30 years, as a factor influencing home prices.
Despite the sluggish start, Moore anticipated home prices to continue growing in 2024, albeit at a slower pace compared to 2023. Factors such as a more stable interest rate environment, ongoing population growth, and a low level of new building activity are expected to support home price growth throughout the year.
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