Lift off! Record Prices Predicted into 2024 says Domain Forecast Report
Are we headed for records - not just recovery - in the housing market?
Residz Team 4 min read
A new report predicts Australia’s property market will roar back to life into 2024.
The Domain Forecast Report FY 23-24 has predicted that over the next 12 months, record-high prices are anticipated in five major capital cities: Sydney, Adelaide, Perth, Brisbane, and Hobart.
“House prices in Sydney, Adelaide, and Perth, and unit prices in Brisbane, Adelaide and Hobart, are likely to rise to new benchmarks due to the depth and aggression of the recovery,” says Domain when releasing the report.
Residz recently noted the talk of FOMO back in Australia’s property market. And, this report’s authors believe population pressure and low listing volumes are indeed placing a floor under prices, and will contribute to the recuperation across several markets.
“130,000 extra homes will be needed in the next financial year alone to house migrants, with the eastern seaboard to welcome the greatest number of arrivals,” says Domain’s chief of economics and research Dr Nicola Powell.
It fits with a recent Reuters poll of housing analysts who predicted the outlook for the market had significantly improved, but Domain’s forecast is even more bullish.
House prices in the combined capitals are predicted to rise 2% to 4% and unit prices 1% to 3% says Domain, while the combined regionals will see house prices rise 1% to 3% and unit prices lift 0% to 2%.
The exclusive analysis, released on June 22, used real-time behavioral data and economic readings to reveal these forecasts:
Sydney: Slow but Steady Recovery Leading to Record Prices
Sydney's property market is expected to recover after a historic price freefall. While the recovery may be slow but steady, it is anticipated the 6% to 9% predicted rise will be powerful enough to send prices skyrocketing to a new record high by the end of the next financial year.
This demonstrates the resilience of the market and showcases the attractiveness of Sydney as a real estate investment destination.
Units in Sydney will rise 2% to 5%, but not to previous record levels achieved in December 2021, says Domain.
Adelaide: A Market That Avoided Downturn and Reaches New Heights
The analysis conducted by Domain indicates that Adelaide's property market has largely avoided the price downturn experienced by other cities. House prices in Adelaide are expected to grow by 2% to 5% over the next financial year, reaching a record high.
Units in Adelaide are also projected to achieve new record prices, lifting up to 2% by the end of FY24, his resilience and growth demonstrate the strength of Adelaide's real estate market.
Melbourne: Stable Prices with Small Gains
In Melbourne, the forecast suggests that house prices will remain stable, with small gains of up to 2% that are unlikely to surpass the record prices achieved in December 2021.
As for units in Melbourne, a range between a 2% price drop and a modest 1% growth is anticipated.
While not experiencing significant growth, the market in Melbourne is expected to hold steady.
Brisbane: Heading Towards Record House Prices
Brisbane homeowners looking to sell will be pleased to see Domain’s forecast of 1% to 4% gains and record house prices for the city by the end of the next financial year.
Although unit price growth is expected to be more modest, Domain says the increases that have already occurred will still push the median to a record level within the next 12 months.
Brisbane's property market is poised for notable growth, attracting both investors and homeowners alike.
Meanwhile, regional Queensland houses are expected to rise 3% to 4% and Gold Coast houses 2% to 4% by the end of FY 23-24.
Canberra: Maintaining High Median House Prices
The analysis indicates that the median house price in Canberra will stay above $1 million, with a rise of 2% to 4% predicted over FY 23-24.
While unit prices may fall 1% or lift modestly by up to 2%. Canberra's real estate market is expected to remain robust, catering to the demand for high-end properties.
Hobart: Steady Growth after a Decline
Hobart's housing market is predicted to experience slow and steady growth after enduring five quarters of decline.
The report says that house prices are expected to rise 3% to 5%, and unit prices are anticipated to post 1% to 3% growth, approaching a new record. Hobart's relative affordability is attracting homebuyers and investors.
Perth: Resilient Market on the Rise
Perth, compared to other capital cities, has demonstrated greater resilience, avoiding a significant downturn.
The analysis by Domain suggests that house prices in Perth will lift 1% to 3% to reach a new record by July of 2024. Additionally, unit prices in Perth are also expected to experience an increase of up to and around 3%.
The real estate market in Perth is primed for growth and presents a favorable environment for investors.
Darwin was not included in the study.
If the Domain Forecast Report FY 23-24 is correct, the Australian property market is set to undergo a resurgence, with record prices expected in Sydney, Adelaide, Perth, Brisbane, and Hobart.
While it represents an opportune moment for homeowners and real estate professionals to capitalise on the market's growth, it may lead to a surge in consumer confidence and spending.
As Forbes Advisor says, “Remember that the RBA is trying to engineer falling consumer spending…. using their blunt tool of interest rate rises, the central bank is trying to fine tune consumer spending so it falls enough to reduce inflation—but not too much.”
If spending plummets, Australia risks going into a recession. Forbes Advisor says recession signals are “flashing red” and Google searches for the word “recession” are unusually high.
About Residz
Residz has lots of research and data for renters, homeowners, and buyers and sellers about Australian real estate:
- If you’re considering purchasing or renting a house, make sure you download the PEXA Property Report for that address. We have 12 million addresses in our database, with every report offering information on internet speeds, crime trends, bushfire and flood risks, investability scores and a whole lot more.
- Would you like to sell your home and connect with home buyers willing to pay your dream price? Residz has the solution, for zero dollars. Put a DreamPrice on your home to test interest. Read about DreamPrice(™) here.
Source: Kristy Johnson, Emily Power, 23 June 2023, Five capital cities on track to new record prices over the next 12 months, Domain Forecast Report FY 23-24, Domain.com.au
Photo by Andrew Spencer on Unsplash