Spring is traditionally a strong period for the property market, and despite conservative market sentiments, 2024 is shaping up to show solid signs of recovery. We’re seeing home prices rise in pockets (over 10% from their December 2022 low) and national sales volumes up almost 14% year on year. Several key economic and political trends are contributing to this landscape. Here, we’ll explore four crucial market influences you should keep an eye on, spring-fuelled property market shifts and provide our top tips for buyers and sellers to make the most of this promising season.
Four key market-influencing factors to follow
From interest rates to immigration and government incentives, these are the four key factors to watch in the lead-up to spring:
1. Interest rates
Forever topping the list are interest rates – and the Reserve Bank of Australia’s (RBA) Cash Rate Target decisions are where you need to focus your attention. While the RBA continues to take a cautious approach to adjustments to minimise inflation, the big four banks are predicting a softening of rates in the not-too-distant horizon, and the recovery phase of the property market cycle is pegged to continue.
2. Supply and demand
Good old-fashioned high school economics supply and demand are forever enduring factors in property market conditions. Ahead of spring, we’re seeing a record-breaking rate of overseas net migration, with housing supply struggling to keep pace. As a result, low rental vacancy rates and intensifying buyer competition outweigh much of the impact we’re seeing from rate increases. This scarcity of homes for purchase or rent shows no signs of slowing. It’s important to remember that these trends can differ significantly between metropolitan areas and regional locations. Major cities often experience more intense competition and price movements, while regional areas see slow and steady gains.
3. Government policies and incentives
The introduction of market-stimulating policies and incentives has slowed for first-home buyers and investors, which can impact market dynamics. We do know, however, that some first-home buyer incentives are capped, so it’s worth making the most of these incentives now before annual limits are reached. In addition, changes to the Stage Three Tax Cuts can potentially increase borrowing capacity for some.
4. The investor influence
For investors, spring 2024 offers promising opportunities. Rental yields have stabilised, and demand for rental properties remains at an all-time high. Astute investors look to regions with planned infrastructure developments and strong population growth for the best possible rental and capital gain returns.
Spring-specific seasonal shifts
Heralding a time of new beginnings, sunnier days and overall positivity, the property market experiences a cyclical uptick as spring approaches. Here’s what we typically experience:
- Competition culminates
With warmer weather, blooming gardens, and longer days, spring brings an increase in buyer activity. More people hit the open home trail and get enthused about making a move, driving increased competition and often faster sales. - Optimism soars
Spring can positively influence market sentiment, making buyers and sellers more optimistic about the market’s performance. This year, we’ve experienced several price hikes and cost-of-living pressures, and predictions indicate the property cycle is heading in the right direction. - Listings lift
Spring often sees a surge in new property listings as sellers take advantage of the better weather and increased buyer activity. This influx can lead to more options for buyers and potentially more competition among sellers. - Auction activity amplifies
On-site auctions that showcase a property’s outdoor aspects often result in more homes going under the hammer. Auction clearance rates tend to be higher in spring compared to other seasons.
Buying or selling? Get the most out of the season ahead
Whether you’re buying, selling or investing, be prepared to make the most of the busy spring season with these top tips:
- Buyers
Whether you’re a first (or third) home buyer or investor, be equipped to act quickly in a competitive market. This includes things like conducting thorough market research, having a solid financial plan and getting pre-approval for a mortgage. If you’re a first home buyer, get acquainted with this guide, and for first-time investors, ensure you’ve ticked these boxes.
- Sellers
Presenting your property in the best possible light is crucial. This should start with market-ready spring cleaning, some spring-specific styling, and checking that you’ve worked through these three stages of preparing your home for sale. Don’t overlook the value of curb appeal, either!
Navigate the spring thaw with an expert team in your corner
While the RBA’s monetary policy influences buyer sentiment and borrowing costs, overall, the spring property market in Australia is expected to be vibrant and active. Local conditions almost always vary from state to state and suburb to suburb, so it’s worth watching regional trends and consulting with your local First National Real Estate team. Having an expert in your corner with decades of collective knowledge and experience is invaluable – they’ll give you the confidence to spring into action when the timing is right and provide you with all the guidance you need to find the keys to your happiness!
DISCLAIMER
The following advice is of a general nature only and intended as a broad guide. The advice should not be regarded as legal, financial, or real estate advice. You should make your own inquiries and obtain independent professional advice tailored to your specific circumstances before making any legal, financial, or real estate decisions. Click here for full Terms of Use.