5 Australian Property Market Trends for 2024

The Australian property market has recently seen some unexpected changes. First the pandemic, then a property boom, followed by climbing interest rates and a forecast cost of living crisis. It’s no surprise that first home buyers, investors, and home upgraders alike are unsure of where the housing market Australia has for its residents is headed next.

Understanding Australian Housing Market Trends

While it seems like no one can get the Melbourne weather forecast right, the Australian housing market is a little easier to interpret. By referencing expert industry insights and current market trends, we can gain valuable insights into where Australian property prices are expected to go in 2024.

1. Modest Rises Forecast for the Australian Property Market

According to the latest data from PropTrak, Australian property prices defied expectations in 2023 by achieving an annual growth rate of 5.42%. Dr Nicola Powell, Domain’s chief of research and economics, said that this growth “defied logic”, before noting several colliding factors as the likely reason. In light of how 2023 played out, Dr Powell predicts the Australian housing market will continue to grow in 2024.

Head of research at CoreLogic, Eliza Owen, agrees that 2024 is likely to see modest growth in Australian property prices. However, she believes the year will start slow as buyers wait to see whether the RBA has finished raising the cash rate.

2. Cash Rate Expected to Stabilise

One indicator that everyone is keeping a close eye on is the official cash rate set by the RBA. At the close of 2023, the cash rate was sitting at 4.35% after steadily rising from a low of 0.10%. The good news is that most<astyle=”text-decoration: none;” href=”https://www.thenewdaily.com.au/finance/2023/12/21/interest-rates-forecast-2024″ target=”_blank” rel=”noopener”> industry experts are expecting the RBA to either hold steady, or possibly even lower the cash rate in the latter half of 2024.

The Commonwealth Bank believes a rate cut could be possible by September 2024, although independent economist Saul Eslake believes the rate is more likely to remain unchanged until at least 2025.

3. More Home Buyers and Investors in Australian Property Market

After seeing Melbourne property prices boom in 2020/2021, the city then saw values fall by almost 8%. However, since January 2023 prices have been rising fairly consistently, indicating that we are once more looking at a competitive housing market. This is largely due to the overwhelming demand for housing in Melbourne, which recently overtook Sydney as Australia’s . 

Increased demand will see a growing number of home buyers and investors looking to capitalise on an upward trend in Australian property prices.

4. The Housing Market in Australia to Focus on Affordability

As the cost of living continues to bite, a higher number of buyers are expected to prioritise affordability. This means the housing market in Australia will likely see increased interest in “bridesmaid suburbs” that were previously overlooked in favour of their inner-city counterparts.

5. Australian Property Prices Encourage Buying Units Over Houses

As a result of migration increases and first home buyers looking for affordable properties, units have been growing in popularity in Melbourne. The median house price in Melbourne in November 2023 was $943,725, while the median price of a unit was just $610,490. And with the Federal Government’s Help to Buy scheme commencing in 2024, the preference for units as an affordable entry point to the Australian property market is expected to grow.

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