Find out what are the most popular homes people are buying, what’s struggling to sell and the top housing trends that’s giving Australians a chance.
If you’re thinking about buying or building a new home, it’s never been a better time.
According to Finder’s best home loan rates 2020, banks are offering as low as 2.59% to 2.74% p.a.
The housing market has also rebounded strongly since last year, especially in major cities Melbourne and Sydney, with plenty of sellers looking for eager buyers.
This has created plenty of opportunities for first home buyers to shop around and explore the property market without the unnecessary stress of ‘missing out’.
To give you a clear idea of what’s currently selling in Australia, we’ve created a state by state list on the Australian property market below, as well as what properties you should be looking out for.
Australia’s big cities’ property market
Sydney property market
Sydney property is known for offering up some of Australia’s most prime property locations. Trends in the Sydney housing market has seen:
- Average sale time of a home has decreased to 33 days (from 57 days a year ago)
- People are willing to part with their properties with a discount average of 3.5% (down from 7.3% a year ago)
- Property values increased by 5.6% in the quarter
- There have been 17% more properties sold in Sydney than in the last 12 months of the previous year
What seems to be trending downwards are purchases of off-the-plan apartments by investors and home buyers, with concerns about construction standards and troubling valuations coming in well below contract price on completion.
This has sparked a great opportunity for hungry investors and home buyers to buy established apartments in the eastern suburbs, lower north shore and inner west at discount prices, cheaper than what they would have paid for a few years ago.
Melbourne property market
Melbourne was listed as one of the top most liveable cities in 2019 and it seems to have continued into 2020, with property prices surging 8.2% higher than the previous year.
- Average sale time of a home has decreased to 31 days (from 45 days a year ago)
- People are willing to part with their properties with a discount average of 3.5% (down from 6.3% a year ago)
- Property values increased by 4.9% in the quarter
- There have been 7.9% more properties sold in Melbourne than in the last 12 months of the previous year
Both apartments and housing have seen an increase in value since the start of 2020 and are expected to continue to rise. It is a buyers and sellers market, however, with the recent COVID-19 virus taking over the world, we are yet to see it’s complete effect on the housing market.
Brisbane property market
Although Brisbane isn’t booming as much as Sydney or Melbourne, with housing seeing an increase of only 0.7% and apartment values dropping by 0.6%, it’s created an affordable market for home buyers and investors.
- Average sale time of a home has decreased to 50 days (from 49 days a year ago)
- People are willing to part with their properties with a discount average of 4.0% (down from 4.9% a year ago)
- Property values increased by 2% in the quarter
- There have been 6.5% fewer properties sold in Brisbane than in the last 12 months of the previous year
There is currently a significant oversupply of apartments in the Brisbane CBD with 1 in 4 new apartments remaining unsold. With all that’s going on — migration rates lifting and supply — housing affordability is quite healthy at the moment compared to other capital cities.
This has created a strong demand from home buyers and investors from the southern side of Australia as they look to make an attractive amount on affordable housing.
Adelaide property market
Housing values in Adelaide have hit a record high with an increase of 1.3% in the last 3 months when compared to the figures from 2018 to 2019.
- Average sale time of a home has decreased to 40 days (from 44 days a year ago)
- People are willing to part with their properties with a discount average of 4.3% (down from 5.0% a year ago)
- Property values increased by 1.3% in the quarter
- There have been 0.8 fewer properties sold in Adelaide than in the last 12 months of the previous year
Things are looking good for Adelaide in the short term with both housing and unit prices rising 1.3% since the start of 2020. Sales activity is trending higher based on improving buyer demand. Adelaide will have better locations to yield long term wealth as Australia’s 3 major capital cities continue to grow.
Perth property market
As usual Perth is much slower than the rest of the nation with property values only now emerging after a 5 year slump. Despite housing up 0.1% over the last month and unit prices rising 0.3%, property values are still 5.7% lower over the last 12 months making it lower than the peak in June 2014.
- Average sale time of a home has decreased to 42 days (from 57 days a year ago)
- People are willing to part with their properties with a discount average of 5.4% (down from 6.6% a year ago)
- Property values increased by 0.4% in the quarter but are still down by -5.7% in the past year.
- There have been 6% more properties sold in Perth than in the last 12 months of the previous year
With conditions slowly improving at a ‘nanna-rate’ (how things usually are in Perth) it looks like things aren’t going to pick up anytime soon. We are, however, one of the most affordable housing markets in the nation. View Perth’s safest neighbourhood.
Hobart property market
In the last few years Hobart has been one of the best property markets with property values recording a record high thanks to investors. However, this boom seems to be over as Hobart’s housing market starts to lose momentum.
- Average sale time of a home has decreased to 25 days (from 17 days a year ago)
- People are willing to part with their properties with a discount average of 2.7% (down from 3.8% a year ago)
- Property values increased by 3.4% in the quarter and up by 5.0% in the past year.
- There have been 9.9% fewer properties sold in Hobart than in the last 12 months of the previous year
A lack of employment drivers, insufficient population growth and not enough infrastructure spending made it a hot spot for investors, which contributed to a property boom. But with a lack of home buyers (which make up 70% of buyers) the market is now slowing down.
Darwin property market
The Darwin property market is not doing too well with current values down 31.8% below their historic peak in 2010 due to the end of a mining boom, low employment market and a lack of migration and infrastructure spending.
- Average sale time of a home has decreased to 68.5 days (from 69 days a year ago)
- People are willing to part with their properties with a discount average of 7.6% (the same a year ago)
- Property values down by -1.6% in the quarter and down by 8.1% in the past year.
- There have been 2% fewer properties sold in Darwin than in the last 12 months of the previous year
Darwin is to be avoided by investors as it does not show any significant signs of growth drivers any time soon.
Canberra property market
Canberra has been quietly peaking over the last year with property values growing 3.1%.
- Average sale time of a home has decreased to 35 days (from 45 days a year ago)
- People are willing to part with their properties with a discount average of 2.9% (2.7 % a year ago)
- Property values were up 2.0% in the quarter and up by 3.1% in the past year.
- There have been 5.7% more properties sold in Canberra than in the last 12 months of the previous year
4 property trends to expect in 2020
1. Lower rates create opportunities for refinancing
Mortgage holders are now able to shop around for a better rate thanks to the RBA cutting official cash rates to historic lows in 2019. It has opened opportunities for homeowners to refinance their mortgages at bargain prices and get ahead in their offset accounts and begin chipping away at their principal.
2. 2020 is a great time for first home buyers
With interest rates at all time lows and plenty of affordable housing available in Perth it’s a good time to lock in a good rate. Don’t get too caught up in the hype of ‘missing out’ and do your research. Courtesy of Scomo, the government introduced a first home loan deposit scheme that would allow buyers to purchase a property with as little as a 5% deposit and avoiding hefty Lenders Mortgage Insurance (which is usually applied if you don’t have a minimum 20% deposit).
3. Secure massively discounted mortgage rates
With cash rates dropping even lower as of February 2020 and furthermore in March by -0.25% due to the devastating effects of Coronavirus, it is now prime time to secure an ultra low mortgage rate. Banks are now offering 5 year fixed loan rates from as low as 2.7%.
4. Hype and fear of missing out prompts more research
With how things are looking, low rates, an abundance of affordable housing and first home buyers grant it can be easy to get swept up in all the hype and fear of missing out. For this reason, Australians should be doing their due diligence before diving in and signing the dotted line for a new home.
It’s important to remember that most home loans are a 30-year commitment and that you need to be aware that even with refinancing options available, at some point in time you could be in a worse situation.
The world is volatile and things are constantly changing, as we are all currently experiencing the effects of COVID-19.
Reference:
These statistics have been taken prior to the breakout of COVID-19 and have been sourced from CoreLogic.
https://www.domain.com.au/advice/how-to-buy-a-property-in-2020-919278/
https://www.savings.com.au/home-loans/australian-economy-and-housing-predictions-for-2020
https://www.homestolove.com.au/home-design-trends-2020-20951
https://www.homebeautiful.com.au/property-trends-australia-2020
https://www.architectureanddesign.com.au/features/comment/top-eight-houses-2020#
https://propertyupdate.com.au/australian-property-market/
