State of the Market | Feb - Mar 2024

29 FEBRUARY 2024

Property prices across the country grew by a less-than-staggering 0.4% in January 2024. This figure is the same for the combined capital cities and regional areas. Despite that, there is no one property market, and prices vary depending on location.


 

Prices were flat in Sydney (+0.2%) and Melbourne (-0.1%), while Perth (+1.6%), Adelaide (+1.1%) and Brisbane (+1.0%) continued their recent good runs. Where we are in regional NSW, prices were up 0.4% during January, 0.8% over the last three months and up 2.9% in the previous 12. This is broadly in line with prices here in Newcastle.

We would describe our local market as being reasonably balanced. After a few years of highs and lows, the last couple of months have been relatively free of turbulence. Buyer numbers are up, and there has been spirited bidding at auctions. But without the COVID-era hysteria.

The most significant change we are noticing on the ground is the increased appetite for people looking to move. Last year was one of the lowest on record for people moving houses. That’s not unsurprising, given a pandemic hangover and rising interest rates. To put some numbers around this, there were 1952 house sales in 2023 (across the Newcastle LGA), well down on the 2571 average over the last 15 years.

But since late last year, we have noticed people are once again back on the move. Perhaps it’s a newfound confidence in the market. Or an adjustment in expectations around interest rates. Many people are seeing homes sold around them for a pretty good price and thinking now might be the time.

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As we will continue to say, prices are dictated by supply and demand. But these are factors to be considered on a macro and micro level. Locally, the number of homes that come on the market could increase dramatically, and it is yet to be determined whether there will be an additional number of buyers to soak up that extra demand. But you need to balance any thoughts of doom with the obvious fact that at a macro level, more people are moving into the country than we are building houses for them to live. In fact, there is a good argument to be made that a perfect storm is brewing in the housing sector.

There is a surging population, and building companies are going under at an alarming rate. Whether it is soaring building costs, trade shortages, high holding costs, council red tape, lack of land or NIMBYism, building in Australia isn’t easy. And these challenges are reflected in dwelling approvals, which have plummeted to record lows.

This stark disconnect paints a clear picture: housing supply is failing to keep pace with demand, and the gap is only widening. We are not here to say that this means prices are likely to continue to rise (we are just humble real estate agents).

 

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But plenty of economists and ‘experts’ think they will.

To us, it feels like confidence has returned to the market. But we will know that for sure when investors start coming back into the market, particularly from Sydney. This is typically a sign that the market is on the move. So far, this has not been a significant factor.

Looking further afield, we thought it would be good to show you how the rest of the state is performing. You may be looking for a tree change after a great time away during the Christmas break. Or dreaming of a holiday home? As you can see in the table above, the Byron Shire takes the cake for the highest median house price in NSW once again. But unfortunately for homeowners there, this is the second year in a row it has seen one the biggest falls in price, coming second to nearby Ballina Shire. It seems many people who bought during the pandemic have lost a small fortune.

Meanwhile, the big geographical centres of Newcastle, Lake Macquarie and Central Coast all moved forward, mirroring Sydney’s performance. And while some of the smaller centres may be tricky to measure accurately given the low number of sales, Maitland LGA stands out for being an area with a high number of sales but poor growth. We haven’t covered every LGA in NSW, but there are still a few bargains out there. You could have purchased a two-bedroom shack in Leichhardt Street, Ivanhoe, in the Central Darling Shire for $75,000. That price even comes on a 3,000m2 block, but sadly it is a 10-hour commute back to Newy.

We’ve also included the record sales by suburb for 2023. These are the best of the best. We’ve tried hard to track down every record house sale by suburb. In the process, we filtered out several development sites and commercial properties. Our intention is to give you a clear picture of the top of the market in each suburb around you.

And finally, a fun fact: In 2023, more houses in Newcastle sold for over $2,500,000 than houses that sold for less than $600,000.

 

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