Survival of the fittest in next year’s property market

“As we look ahead to 2024, the real estate market is poised for a dynamic shift, influenced by a range of economic and demographic factors,” said Mr Stevens.

“With listing volumes expected to rise, sellers will need to be agile and well-informed to navigate this fluctuating market, positioning their properties to stand out in a potentially crowded market,” he advised.

The proptech CEO stressed that sales conditions will vary substantially from market to market, observing that “property values are increasingly influenced by fluctuating interest rates and regional economic trends”.

This means that while listing volumes have been experiencing a general slowdown, Mr Stevens believes there remains a high demand for quality properties in desirable locations as a result of local market variations.

“Investors are advised to keep an eye on emerging hotspots, where growth potential is likely to be concentrated, particularly in areas showing resilience to economic fluctuations,” he said.

The predictions follow on from the Reserve Bank of Australia (RBA)’s final rate decision of the year, which saw the national cash rate remain at 4.35 per cent.

The hold was welcomed by commentators, who feared that the Australian housing market could topple under the pressure of what would have been the 14th rate rise since hikes began in May 2022.

Scott O’Neill from Rethink Investing noted that high interest rates were “dissuading developers from constructing and discouraging investors from supplying rental properties to the public”. He also noted that mortgage holders have been facing high levels of financial pressure due to repayment costs.

Roy Morgan CEO Michele Levine confirmed this observation, stating that any further rate rises could put 75,000 mortgages at risk – on top of the 1.5 million mortgage holders who are already facing precarity.

CoreLogic data revealed that the impacts of interest rate rises have been unevenly divided between urban and regional markets, with many regional areas witnessing drops in sales volumes.

“We’re already seeing an easing in the pace of monthly growth across our largest cities, and this is a trend we can expect to see playing out more broadly at least until interest rates top out,” said CoreLogic economist Kaytlin Ezzy.