Monthly Property News 12th Edition 2023.

“Patience is a virtue”

Hi everyone, I’m Jason Mudford from OBrien Corporate with the twelfth and last edition of the property news for 2023.

Patience is a virtue, and every market has an equilibrium, meaning there are good reasons to buy, good reasons to sell, reasons to stay at home a bit longer, and reasons to fly the coop and rent, but what makes it the right decision will always be based on your personal circumstances. Always listen to yourself first and then seek counsel on your opinions through those with experience and wisdom because it’s always important to not be reactive and stick to a long-term plan.

Supply will be the main metric to watch again in the coming year, and most experts say it will have more influence on the performance of the market than interest rates. According to Proptrack, investors today make up about 33% of all sellers, and the plus-60 age bracket has now become the leading age demographic as a landlord provider, meaning fewer young people today are willing to invest in property. This suppressed appetite is also showing in New Dwelling approvals, which are 21% lower over January to August 2023 versus the same period the year before.

Demand will also have a strong influence again on the real estate market in 2024, and it looks like demand will continue to be strong despite the high barriers to entry. Australia is forecast to be in the top three OECD developed nations for population growth until 2030, with over 3.2 million people to move here from 2022 to 2030, and Victoria is set to capture 688,000, which is greater than any other state.

In terms of trends in 2024, it’s interesting to note that “solar panels,” “sheds,” and “furnished” are the 3 most trending keywords in rent searches, according to realestate.com.au. These are great insights for landlords who want to get the best from their property investment. Also worth mentioning is that from 1st Jan 2024, government solar rebates will be reduced, and on top of this, it’s just been announced that energy prices are set to increase once again by up to 25%, which is on top of the 35% (up to) they have already increased this year.

Reviewing the 12-month change in all dwelling home prices in Metro Melbourne, we have seen a net average 3% increase, and comparing that to the four other major capital cities, Sydney has had 10.2%, Perth 13.5%, Brisbane 10.7%, and Adelaide 7.6%. From a Regional Victoria perspective, there has been a 2.2% decrease in home prices.

The heat in the rental market this last month has definitely slowed, and this is mainly due to the time of year. People always like to stay put over Christmas and move early in the new year. The forecast for the Victorian rental market in 2024 will be much the same as it was this year; a shortage of homes will continue to be the common denominator and landlords will have the pressure of higher mortgages and rents will continue to rise.

They say the best of all gifts around any Christmas tree is the presence of a happy family all wrapped up in each other. I wish you a very Merry Christmas, surrounded by your precious family, and many blessings for the coming year. Remember, the information provided is of a general nature; you should always seek independent legal, financial, taxation or other advice in relation to your unique circumstances.

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