Australian Property Market Insights: Navigating the 2024 Landscape

Published: 26th January 2024

G'day, Property Enthusiasts!

As we wrap up another week, the Aussie property market has dished out its fair share of surprises, keeping us all on our toes. From the unexpected leap in unit rents outdoing houses in our bustling capitals to the spirited comeback of first homebuyers, there's plenty to unpack.

So, grab a cuppa and settle in as we delve into the latest twists and turns of the property scene down under, offering you the insights you need to stay ahead in this dynamic market.

The Australian property market is a dynamic and ever-evolving landscape, with trends that can often feel as unpredictable as the weather. But just like a seasoned sailor who reads the wind and tides, understanding these shifts can help you navigate towards your property goals with confidence.

Unit Rents Outpace Houses in Major Cities

In an unexpected twist, unit rents have begun to outstrip house rents in many of Australia's capital cities. The latest figures from the Domain Rent Report reveal a startling parity, with both unit and house rents averaging $600 a week. However, the devil is in the details: unit rents have surged by a whopping 20% over the past year, compared to a 9.1% increase for houses. This trend is particularly pronounced in cities like Sydney, Melbourne, and Brisbane, where the demand for units is reshaping the rental market landscape.

Sydney leads the charge with unit rents at $680 per week, a 17.2% increase, while house rents lag behind at a 12.3% increase to $730 per week.
Melbourne's unit rents have climbed 15.6% to $520, with house rents close behind at 14.6% to $650.
Brisbane, Adelaide, and Perth also report similar trends, with unit rents rising faster than house rents.

Dr. Nicola Powell, Domain's chief of research and economics, notes that the unit market's affordability has dramatically shifted since the pandemic, with cities once again drawing people back and driving up demand.

Australian city skyline showcasing residential units and houses reflecting 2024 property market trends.

The Return of First Homebuyers

Amidst rising rents and tightening vacancy rates, there's a silver lining: first homebuyers are making a comeback. The Australian Bureau of Statistics highlights a 20.3% increase in first-time homebuyer loans over the year to November 2023. This resurgence is fueled by the desire to escape the rental rat race and step onto the property ladder, with the average mortgage for these new entrants now standing at $505,000.

Queensland, Western Australia, and South Australia are leading this charge, offering more affordable entry points for first homebuyers. This trend is a testament to the resilience and adaptability of Australians looking to secure their slice of the property dream.

First homebuyers receiving keys, symbolizing the resurgence in the Australian property market 2024

A Glimmer of Hope in Vacancy Rates

For renters, the market has been less than forgiving, but recent data suggests a slight easing in vacancy rates. PropTrack's latest figures show a national vacancy rate of 1.12% in December, a modest increase that nonetheless offers a glimmer of hope. Cities like Sydney, Melbourne, and Brisbane are seeing slight improvements, though rates remain critically low in Perth and Adelaide.

Eleanor Creagh, PropTrack's Senior Economist, cautions that while there's a slight easing, the rental market remains tight, with many tenants likely to feel the pinch in their budgets.

Graph illustrating the easing vacancy rates in Australia's major cities, a positive shift in the 2024 property market.

Median Prices Signal Market Resilience

In a reassuring sign of the market's strength, median house prices have bounced back, fully recovering from any dips experienced in 2022. Oxford Economics Australia reports a record national median house price of $939,000 in December 2023. This rebound is particularly notable in Melbourne and Sydney, where listings are on the rise, though Perth, Brisbane, and Adelaide continue to see low levels of listings, hinting at further price growth.

Maree Kilroy of Oxford Economics suggests that anticipated interest rate cuts in late 2024 could spur broad price growth, with units likely to lead the charge as more affordable options.

Median property price growth curve, highlighting the resilience of the Australian property market in 2024.

Navigating Your Property Journey with Rasti Vaibhav

As we sail through the ever-changing seas of the Australian property market, it's crucial to stay informed and adaptable. Whether you're a first-time buyer feeling the winds of change or an investor charting a course through the currents of the rental market, knowledge is your most valuable compass.

I'm Rasti Vaibhav, The Architect of Property Wealth, and I'm here to guide you through these turbulent waters. If you're pondering your next move in the property market or seeking to understand how these trends might affect your investment strategy, let's have a chat.

Ready to dive deeper? Book a time with me to discuss your personal circumstances and explore how property investing could work for you: https://getrare.com.au/ready. Or, if you're keen to expand your knowledge, join us at one of our educational workshops: https://getrare.com.au/workshop.

Together, we can navigate the complexities of the property market and chart a course towards your property wealth goals.

Rasti Vaibhav, The Architect of Property Wealth

Remember, understanding the market's nuances is key to making informed decisions.

Let's embark on this journey to property success together!

Disclaimer: While the content we've shared is chock-full of information, remember it's general in nature. Your financial journey is unique, so it’s crucial to have a yarn with your own adviser before making any moves. This isn't personal advice, just a bit of friendly wisdom to ponder. Always tailor your decisions to your individual situation for the best outcomes.