This article is from the Australian Property Journal archive
ANALYSTS continue to back in Perth’s housing market to lead the nation for price growth in 2024, with the Bank of Queensland tipping the Western Australian capital to be the only major city to show double-digit growth throughout the year.
Strong broad-based rises are expected for all the capitals over 2024 and 2025, according to chief economist Peter Munckton, with some of the weaker capitals of recent times to be key movers next year.
Perth prices are tipped by Munckton to surge by another 15% over 2024, following a nation-leading 19% jump in 2023. The REIWA this week said Perth’s median house sale price could see a 20% surge by the end of 2024, following two quarters of healthy growth.
Perth is followed by Brisbane in the price growth forecast (9%, after 12% growth in 2023), according to Munckton, and then Adelaide (8%, following 9%). The trio of cities has demonstrated a severe mismatch of supply and demand.
Munckton said house prices has broadly moved in line with his forecasts so far in 2024, with Melbourne being the exception.
“I had been thinking that the combination of strong population growth and decent value would see stronger growth.
“I am going to keep to the view of stronger growth in Melbourne prices although four successive monthly declines in standalone house prices (according to CoreLogic data) is seriously testing that view.”
Melbourne prices are still tipped to rise 7% in 2024, before 9% in 2025 – the highest in the country.
Decent growth is likely for Sydney (6% in 2024 and then 5% in 2025), while modest growth appears likely in the Canberra (3%), Darwin (2%) and Hobart (4%).
“The likelihood of rate cuts should provide support for decent house price growth in 2025.” Munckton said.
Some analysts have pivoted to forecasting that the Reserve Bank is more likely to hike interest rates than not in the wake of this month’s inflation data, pushing out the next rate cut to either late in the year or into 2025.
Munckton said growth is likely to be strongest in the markets that have seen the lowest growth over the past couple of years.
Hobart is set for 7% growth in 2025, Canberra 6% and Darwin 5%.
Brisbane prices are tipped to rise 6%, Adelaide 6%, and Perth 7%.
