We expect that price growth will be slower in 2024 than in 2023, primarily due to a cooling down market. National house and unit prices are forecasted by KPMG to continue to rise by 5.3 percent and 4.5 percent in 2024. As the market adjusts and we expect more balanced population growth in 2024, these factors will result in a more tempered growth trajectory for dwelling prices.
Key insights into Australia's residential property market
Australia’s house and unit prices have increased
In a year of high interest rates, elevated inflation and subdued consumer sentiment, national house prices increased by 7.7 percent and national unit prices increased by 6.1 percent between March 2023 and March 2024.
Households are coping amongst mortgage rate increases
As the labour market remains robust and the unemployment rate remains relatively low, households seemed to have coped with the 4 percentage point increases in the mortgage rates and the fixed-rate mortgage cliff.
Rental prices are rising along with the population
Rental prices have been on the rise as strong population growth and limited housing supply are exerting more pressure on the rental market. Rental price growth continues to reflect low vacancy rates and a tight rental market.
Interest rates will continue to influence house prices in FY25
Interest rates will be the main influencing factor to house prices in 2025. We expect the RBA to cut rates in the last quarter of 2024 which is anticipated to have a positive impact on house prices via the availability of credit and buyer’s confidence.
Why KPMG
KPMG’s team of expert economists analyse the residential property market, providing historic and forecast figures regarding dwelling prices by property type and market.
If KPMG can help your business in any way navigate the current business environment and plan for any future developments that are facing the economic climate, please contact us.
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Related information
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