Property Weekly Pulse with Rasti:
Week Ending 23 Feb ’24

G’day, property enthusiasts! As we sail through the dynamic tides of the Australian property market, the week ending 23 February ’24 has brought us some fascinating insights. With land prices reaching new peaks and the rental market squeezing tighter, it’s an exhilarating time to be involved in real estate down under. Whether you’re a first-home buyer, an investor looking to expand your portfolio, or simply keeping an eye on the market, I’m here to share the latest trends and tips to help you navigate these waters.

Land Prices Soaring to New Heights

The Australian dream of owning a piece of this beautiful country is becoming more challenging, with the national median price of a residential block hitting a record $340,000 in the September quarter of 2023. This surge, highlighted by the Housing Industry Association (HIA) and CoreLogic, is primarily due to a shortage of lots, exacerbated by the pandemic’s lingering effects.

Tom Devitt from HIA sheds light on the situation, pointing out that the struggle to deliver necessary infrastructure and rising developer contribution charges are significant hurdles. This scenario is creating a bottleneck, making it tougher for new homes to enter the market, contrary to the Australian Government’s goals for housing affordability.

A Beacon of Hope for First-Home Buyers

Despite the daunting landscape, there’s a silver lining for first-home buyers. The Federal Government’s Home Guarantee Scheme is offering a lifeline, enabling purchases with as little as a 5% deposit. Anne Flaherty from PropTrack has identified several areas where owning a home is still within reach, including:

● Victoria: Thomastown and Mickleham

● Queensland: Morayfield and Springfield Lakes

● New South Wales: Hamilton and Mayfield

These spots are where dreams of homeownership can become a reality, often with mortgage payments more affordable than rent.

Grandparents: The Silent Pillars of Homeownership Dreams

In an emotional twist to the property narrative, grandparents are increasingly becoming the unsung heroes. Research from McCrindle highlights a growing trend of grandparents providing financial support or even free housing to help their grandchildren onto the property ladder. This generous support is a testament to the deep familial bonds and the collective effort to secure the next generation’s future.

The Build-to-Rent Sector: A Rising Star

The build-to-rent (BTR) sector is poised for explosive growth, with projections indicating a potential tripling of units by 2026. This sector, buoyed by over $5 billion in capital last year, is set to revolutionize the Australian rental market. Robert Papaleo from Colliers emphasizes the critical need for institutional investment to sustain this growth, drawing parallels to the UK’s successful BTR market evolution.

The Rental Market Tightens

As university students return, the demand for rentals is spiking, pushing prices up. With a national vacancy rate of just 1.1%, the competition for rental properties is fiercer than ever. Louis Christopher from SQM Research advises renters to stay vigilant and proactive in their search for accommodation, as rents are expected to climb steadily.

Navigating the Australian property market in 2024 is akin to charting a course through uncharted waters. With land prices at record highs, promising opportunities for first-home buyers, grandparents stepping up in a big way, the Build to Rent sector booming, and rental markets tightening, the journey is full of challenges and opportunities.

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Rasti Vaibhav, Your Architect of Property Wealth and Buyers Agent.

Navigating the property market’s complexities can be daunting but fear not – we’re here to guide you through. Keen on understanding how these developments impact your property journey? Book a one-on-one consultation with me at https://getrare.com.au/ready or join our upcoming educational Masterclass on Fast Tracking Your Financial Freedom. More details here: https://getrare.com.au/financial-freedom

Let’s unlock the potential of your property aspirations together!