Your Property Market Insights
Top Suburbs to Watch in 2025, Rising Property Confidence & More: A Weekly Look at The Hot Topics in Real Estate Across The Country…Dec 22 2024
Welcome to your weekly edition of Groundswell Property’s Market Insights, where we bring you the latest trends, research, and expert opinions shaping real estate across Australia.
Whether you’re keeping tabs on market trends or strategizing your next property move, these updates will help you make informed decisions. Let’s dive in and explore this week’s top stories!
Here’s what we’re covering in this edition of YPMI:
Seasonal Vacancy Rise: Residential rental vacancies have hit their highest levels in three years, with economic pressures and shared living trends influencing the market.
New Home Sales Outlook: Despite a November dip, 2024 is expected to end on a high, with confidence growing for 2025.
Innovative Housing Solutions: Westfield’s parent company is exploring apartments above shopping centres to address housing supply challenges.
Rising Property Confidence: Confidence in the property sector is climbing, but housing supply and affordability remain key concerns.
Top Suburbs to Watch in 2025: REA Group has unveiled its Hot 100 list, featuring affordable suburbs and hidden gems across Australia poised for growth.
As always, our goal is to provide evidence-based insights to help you make informed property decisions—whether you're buying, selling, or simply keeping a pulse on the market.
The REA Hot 100: Suburbs Tipped To Rise in 2025
Property experts have picked the top suburbs to watch in 2025 for the REA Group’s Hot 100.
REA Group director of economic research Cameron Kusher says a large number of affordable suburbs are on the list this year.
Suburbs are nominated based on growth drivers, including affordability, amenity, family appeal, location, investment prospects, gentrification, population growth, demographic change and infrastructure spending.
REA economist Anne Flaherty says despite recent price declines she believes Melbourne is poised for strong future growth.
"If you look at the fundamentals of Melbourne's property market, it is forecast to be the strongest growing capital city (for population), it has the most diverse local economy, it attracts very high numbers of international students and international migrants,” she says.
Among the top 100, the experts picked Mayfield, Enmore and Prestons in New South Wales, Braybrook, Corydon and Geelong West in Victoria and Coomera, Fairfield and Herston in Queensland.
Picks in South Australia include Andrews Farm, Munno Para West and Christie's Beach and in Western Australia, Bassendean, Bayswater, and Scarborough are among the top picks.
Flaherty says some on the list are the lesser-known suburbs that may benefit from amenities in neighbouring areas or be starting to see gentrification.
Confidence Returning
While the long-awaited interest rate cut did not materialise in the second half of 2024, confidence is still rising in the property sector.
The December 2024 Procore/Property Council Industry Sentiment Survey shows industry confidence is up by eight points, even though concerns remain about supply, affordability, and construction challenges.
The survey shows South Australia is the most confident state, while confidence has risen in New South Wales and Queensland property markets, followed by Western Australia.
Confidence is lowest in Victoria.
Property Council Chief Executive Mike Zorbas says property price growth expectations by respondents have soared.
However, the survey says housing affordability and supply are the most critical issues facing the property sector.
Zorbas says urgent government intervention is needed to deliver more homes.
“Solving the housing crisis requires action on all fronts – from reducing costs to cutting red tape and fostering greater investment,” he says.
Scentre Group Taking ‘Shop-top Apartments’ To The Next Level
Shopping for a new apartment could soon be combined with a trip to pick up the weekly groceries if shopping centre owner Scentre Group pursues plans to build on top of its existing centres.
Scentre Group owns and manages 42 Westfield shopping centres across Australia and New Zealand.
Chief executive Elliott Rusanow says it is considering redeveloping its properties to incorporate residential apartments above them. This will ensure the company's long-term growth and help ease housing supply issues.
"Our Westfield destinations are located in and around existing civic and transport hubs - places where densification is already occurring," he says.
"These substantial land holdings, when combined with their strategic locations, have the potential to be part of addressing the housing supply issues in both countries."
Associate director at the University of New South Wales City Futures Research Centre, Hal Pawson, says the airspace above shopping centres could provide an option for valuable housing stock.
"It's far preferable to be doing it in sites like that than on the fringes of cities," he says.
Seasonal Vacancy on The Rise: CBDs The Biggest Contributors
Residential vacancy rates rose to 1.4% in November, the highest level in three years, according to SQM Research.
It says the total number of vacant rental properties is now 41,894, up from 36,486 in October, due mainly to seasonal factors.
According to SQM Research, vacancies rose to 2% in Melbourne, 1.8% in Sydney and 1.1% in Brisbane - all still below the 3% considered to represent a balanced rental market.
Inner city markets have much higher vacancy rates including, Sydney CBD (6.4%), Melbourne CBD (5.9%) and Brisbane CBD (2.4%).
SQM Research, Managing Director Louis Christopher says the rise is a result of seasonal factors and broader economic pressures.
“At this time of year, we normally record a seasonal increase in vacancies driven in part by university graduates completing their courses and returning home,” he says.
Christopher says high living costs mean more people are pooling resources and moving into shared housing instead of renting a property on their own, which has also freed up some of the rental market.
High End To 2024 for New Housing
New home sales are tipped to end the year on a high despite a softening in November, according to the Housing Industry Association.
It is predicted that by the end of 2024, new home sales levels will be higher than those recorded in 2023.
The latest HIA New Home Sales Report shows sales were up 8.8% in October before a 10.1% fall in November.
HIA Economist Maurice Tapang says despite those fluctuations, all indicators show an improvement in market confidence through the course of 2024. And he believes the market will continue to improve in 2025.
“Stabilising home building materials costs, a return to normal build timeframes, low unemployment and unchanged cash rate settings have provided the certainty that new home buyers need,” Tapang says.
“The rise in sales has been geographically dispersed, with markets such as Queensland, South Australia and Western Australia faring better than the two largest states.”
“As the volume of established homes available for purchase and rent remains inadequate to service growing demand, buyers are increasingly returning to the new home market.”
Key Takeaways
As we wrap up the final 2024 edition of Your Property Market Insights, it’s clear that the property market continues to evolve with a mix of challenges and opportunities. With rising confidence, 2025 promises to be a year of growth and transformation.
Keep an eye on the suburbs tipped for strong growth, stay informed on market dynamics, and remember: the key to success in real estate is staying ahead of the trends. Thanks for joining us, and we’ll see you on Saturday 11 January 2025 more insights to guide your property journey.
Have a safe and happy Christmas and all the best for a prosperous 2025 - Tom
Tom Haigh
Director & Licensed Buyers Agent
Groundswell Property - Established 2015
tom@groundswellproperty.net0439754475