State of the Nation | May 2024

Download the State of the Nation | May 2024 Report

The national property market continues to perform strongly with the latest data showing an annualised national price growth of 7.2 per cent. Although slightly down on last year’s growth of 8.1 per cent, this is a robust result in the environment of elevated interest rates and economic uncertainty.

Following the Easter holiday period, we’re now seeing a significant uplift in listings on the East Coast. Western Australia continues to have a distinct shortage of listings. Nationally, the latest Corelogic data shows a 23 per cent increase in listings across the country over the most recent four week period. We anticipate this increase in supply will continue into a strong winter of activity across the country.

A number of factors are contributing to more stable market conditions. In particular we’ve now seen interest rates remain at 4.35 per cent since November last year. RBA meetings are now every six weeks and this reduced frequency combined with an environment of more stable rates for longer, means that buyers and sellers are gaining more comfort of knowing their borrowing power won’t change significantly in the short term. 

Calls for interest rate reductions have proven premature due to the most recent inflation data, and it’s becoming increasingly clear that services inflation is proving harder to reduce than originally anticipated. This is leading to a likelihood that rates will be higher 

for longer and an increased possibility that the next interest rate move may even be up.

Putting interest rates aside, the main drivers of price movements are increasingly the fundaments of demand and supply. Equally, cost of living and liveability are critical factors in our markets.

Perth, Adelaide and Brisbane lead national price increases with annualised gains of 24 per cent, 14 per cent and 13 per cent respectively over the past quarter. Sydney is trailing at 5 per cent and Melbourne, where prices remain flat at August 2023.

Liveability is playing a key role in pricing with the most recent ANZ Core Logic Housing Affordability Report showing the percentage of income required to service a mortgage in Perth is sitting at one of the lowest levels in the country at 41.3 per cent, which compares to the highest, being Greater Sydney at 59.9 per cent. This disparity will continue to drive demand and therefore price growth for the cities of Perth, Brisbane and Adelaide in the near term.

Overall, we expect the balance of the calendar year to deliver higher levels of activity, providing home owners and buyers with greater choice and prices underpinned by strong demand and delivering lower levels of price growth.