It has been an interesting start to the year for the Australian property market. While sales volumes were characteristically low across January, we still managed to get a good sense of what lies ahead. And it seems that is a continuation of recent trends, albeit with a few notable exceptions.
Most significantly, it appears that growth is continuing to slow, with quarterly house price numbers down. However, we did see a slight rallying within the last month, with housing values increasing by 1.1%. This is up 0.1% on last month’s figures, thanks largely to the stabilisation of several key markets.
Drilling down a little deeper, we see that performance continues to vary greatly across the country. While Brisbane and Adelaide once again saw strong growth in dwelling values, most other capitals achieved much more modest gains. That said, five of the eight capitals did record increases when compared to December, including Melbourne, which returned to positive monthly growth numbers.
While this diversity in performance is also being seen outside the capitals, regional property markets were generally much stronger. In fact, monthly price growth was 1.2% or better, for every “rest of state” area and 1.8% for combined regionals. This continues the recent trend, with regional markets significantly outperforming the capitals on a rolling quarterly basis (6.3% v 2.6%).
The growth in rent rates is also slowing, with the national median up 9.0% over the last 12 months. This is slightly down on the peak annual growth rate of 9.4%, which was seen in November. This is largely being driven by the downturn in the Darwin and Perth rental markets, which were the country’s strongest in mid-2021.
What lies ahead
It is difficult to know exactly how the next few months will play out for Australia’s property market. While recent trends give us some idea of what to expect, there is still plenty of uncertainty. There are also a few key factors that could have a major impact on both the sales and rental markets.
Suburb Spotlight: Chermside West (QLD)
The charming suburban enclave of Chermside West is located a mere 11km north of the Brisbane CBD. Much like many other areas in the city’s north, it enjoys easy access to a wide range of important amenities. However, it is its unparalleled proximity to schools, shops, cafes, hospitals, and parks that makes Chermside West so popular.
As house values have increased consistently over the last couple of years, the suburb also has clear investment potential. This is complemented by a low vacancy rate (currently around 1%) and a median rent rate of $500. While this does mean a yield of under 4%, rents in the area are increasing, up over 5% over the last year.
In fact, Chermside West is considered one of the city’s most liveable suburbs, mostly thanks to its amenities and transport connections. These features have also made the area quite popular with a range of residents, and both buyers and renters. Despite this, the suburb still remains relatively affordable, with a median house price of around $700,000.
At Search Party Property, we specialise in developing tailored investment strategies and will work with you to come up with a suitable plan of attack. We also regularly assess your strategy ensuring that it is fit for purpose and delivering the desired results.