The Australian Property Market Hits $11 Trillion – A New Milestone

Current Market Trends and Insights

While Australia’s property market may currently be displaying signs of a slowdown, national house prices are climbing, with a slight increase of 0.3% in October, bringing the median to $809,849.

According to CoreLogic data, this marks the 21st straight month of property price increases, yet growth remains uneven across the capital cities. While Perth, Adelaide, Hobart, and Brisbane led with solid price gains, other capitals such as Melbourne and Sydney have seen a slowing down in house prices.

We’ve used the latest data from Domain to reveal current market trends driving house prices and rental demand in Australia’s major cities.

Sydney

Despite growth halving compared to the previous quarter as well as the same period last year, Sydney house prices still rose by $9,000 (or 0.6%) in the September quarter. This marks the seventh consecutive quarter of growth for the city.

Sydney house rents also grew about 1.5 times faster than the previous quarter. Rising by 2% or $15 to reach a new high of $775 per week, the median weekly rent for houses continues its upward trend. In contrast, Sydney unit rents held steady for the first time this year, staying at a record $720 per week during the September quarter.

Melbourne

Melbourne’s house prices decreased by 1.5% or $6,000 in the September quarter, marking the third consecutive quarter of falling prices. On the other hand, Melbourne’s unit market saw a slight increase in prices with a growth of 0.5%. This is due to an increase in demand for apartments in inner-city areas as well as strong population growth driving rental demand.

Brisbane

For the seventh consecutive quarter, Brisbane house prices have risen, increasing by nearly $15,000 (or 1.5%) to reach $994,945. However, the growth rate has clearly slowed, with this quarter’s increase being about one-third slower than the previous quarter. Brisbane unit prices also experienced moderate growth, increasing by 0.8% to reach a record high of $409,795.

Adelaide

Adelaide’s housing market is rising, with the median house price increasing by nearly $39,000 (or 4.2%) over the September quarter, reaching $973,336 and nearing $1 million. While growth remains high and above the historical average of 2.6%, it has slightly slowed compared to the previous quarter.

Adelaide also ranks as the second strongest capital city unit market, experiencing a 3% increase (equating to $16,000) over the September quarter.

What This Milestone Means for Investors

The milestone of $11 trillion in total is significant in that it reflects the continuing strength and resilience of Australia’s property market. However, as the above data points out, the property market is cyclical, and each city has its own unique trends and dynamics. Property investment is a long-term game, and investors should focus only on short-term fluctuations insomuch as they provide opportunities for long-term gain. Meaning, investors can capitalise on a cooling market with lower property prices to buy into areas that are likely to experience capital growth in the future.

Borderless Investing

The $11 trillion milestone emphasises the value of diversified or borderless investing.

Investing in properties across different cities offers a range of advantages for savvy investors seeking to both diversify and strengthen their portfolios. One such advantage is the ability to counterbalance market fluctuations in one particular city by capitalising on growth opportunities in another. By investing outside of your home city, you gain exposure to different economic drivers, local demand factors, and other variables that can impact capital growth.

Ironfish have eyes, ears and boots on the ground in all the major capital cities of Australia and can help you identify investment-grade properties that align with your investment goals and strategy.

Conclusion and Key Takeaways:

Australia’s property market reaching the $11 trillion mark highlights not only its remarkable growth, but also its investment potential. With a mix of factors such as population growth, infrastructure development, and rising demand, the market offers promising opportunities for both seasoned and new investors.

For investors looking to navigate the Australian market, informed, diversified investing remains crucial. Ironfish’s team of experts can provide guidance and support in identifying the right investment opportunities across multiple cities, helping investors achieve long-term financial success.

Key Takeaways:

1. Market Strength and Resilience: Australia’s property market growth to $11 trillion showcases a robust real estate sector supported by steady demand and economic strength.
2. Importance of Diversification: The cyclical nature of regional markets underscores the benefits of borderless investing to mitigate risks and maximize returns.
3. Capitalising on Growth Cycles: Strategic investments in varied locations allow investors to benefit from growth cycles, population shifts, and infrastructure improvements in different cities.