Property Prices on the Rise: Is Now the Right Time to Buy?

The Australian property market is buzzing with activity, and recent data suggests that now could be a prime time to make your move.

With interest rates expected to drop soon and property values continuing to rise, buyers and investors are facing a rapidly shifting landscape.

Whether you're a seasoned investor or just starting to explore your options, this update will give you the latest insights to help you make informed decisions in the weeks ahead.

Is Now the Right Time to Buy a Home?

According to the Westpac-Melbourne Institute Consumer Sentiment survey, buyer confidence is making a strong comeback.

The market has been waiting on the sidelines, and it seems many prospective buyers are now feeling more confident about jumping in. But why is this happening?

Interest rate expectations: Buyers are anticipating that interest rates will start falling early next year, or at the very least, won’t go any higher. This has created a surge of interest, as many are eager to buy before competition intensifies.
First-home buyer incentives: Both Queensland and South Australia are rolling out new assistance packages for first-home buyers, making it an attractive time for those looking to get into the market.

Matthew Hassan, a senior economist at Westpac, notes that confidence has returned because people are starting to believe that interest rates will drop in the near future. In fact, he's predicting a cash rate cut by February.

If you’re thinking of buying, now might be the time to act. Waiting could mean facing more competition and higher prices as the market heats up again.

Cranes and residential construction in Australia’s property market.

The Australian Property Market Hits a Record $11 Trillion

The value of Australia’s property market just keeps growing, and it has now crossed a huge milestone.

The total market value has exceeded $11 trillion for the first time in history, driven by an increase of $900 billion in just the last 12 months.

Some key points to consider:

6.7% growth in home values across the country for the year to September 2024
Perth leads with 24.1% growth, followed by Adelaide at 14.8% and Brisbane at 14.5%
Even Sydney saw growth of 4.5% in the same period

These numbers show that despite the challenges, property remains a solid investment for many Australians.

It’s also worth noting that smaller capital cities like Perth, Brisbane, and Adelaide are driving much of this growth, making them attractive markets for investors.

Graph of Australia’s property market growth hitting $11 trillion.

Cranes Are Still Dominating the Skyline

Construction across Australia remains robust, particularly in the residential sector.

The latest Rider Levett Bucknall Crane Index provides an insight into how many projects are currently under construction and where.

Despite a drop in apartment approvals, the number of cranes on residential projects remains high.

There are currently 493 cranes working on residential developments nationwide. Here’s a quick look at some of the major cities:

Sydney: 232 cranes, down slightly from earlier in the year but still leading the way
Brisbane: 33 cranes, showing strong growth in the residential sector
Melbourne: 80 cranes, though down from 107 at the start of the year

These numbers suggest that even with some fluctuations, the residential construction market remains active, and we can expect to see more housing supply in the near future.

New Australian homeowners benefiting from rising property values.

Home Building Approvals See a Small Uptick

While it’s great to see cranes in action, the issue of housing supply remains a challenge.

The latest data from the Australian Bureau of Statistics shows that home building approvals have increased slightly, with a 0.5% rise in approvals for new houses in August 2024.

However, the figures for apartments and townhouses are a bit more concerning, with approvals dropping by a significant 16.5%.

According to Shane Garrett, the chief economist at Master Builders Australia (MBA), this drop is worrying, as Australia is still struggling to meet its housing targets.

The problem is exacerbated by a shortage of tradespeople. In fact, the National Centre for Vocational Education Research highlights an alarming shortfall in apprentices entering the construction industry.

Real estate agent handing keys to a buyer in Australia’s property market.

What Does This Mean for You?

The Australian property market is moving fast, and whether you’re looking to invest or find your dream home, it’s essential to stay informed.

The data shows that now might be an opportune time to buy before competition heats up further, particularly in growth markets like Brisbane, Perth, and Adelaide.

But it’s also clear that housing shortages and labour issues are likely to keep prices on an upward trajectory. That’s why understanding the market and planning ahead is crucial.

If you’re interested in discussing your property goals or simply want to chat about how this latest market update could impact you, feel free to reach out. Let’s have a one-on-one conversation about your personal circumstances and how property investing could work for you.

You can book a time here: Book a Time, or if you're interested in learning more about Investing in Property through SMSF, join one of my educational workshops here: Book a Workshop.

Cheers,

Rasti
Your Architect of Property Wealth