December 2024 Property Update
Welcome to our December property update
As 2024 draws to a close, Nationally prices have risen by 5.5% over the past 12 months. This is the 22nd straight month of growth, however growth is further slowing, increasing in Sydney by 3.3%, Brisbane by 12.1%, Adelaide by 14% and Perth by 21%. Melbourne fell by 2.3% over the past year.
As expected the Reserve Bank left the official interest rate on hold at the December meeting. The next meeting will be mid February 2025, and most economists are expecting rates to fall between February and May 2025, whilst Financial markets are expecting rates to fall mid 2025.
One huge change is that The Reserve Bank of Australia (RBA) will have two boards from 1 March 2025 – one to set the cash rate and another for governance. As 2025 will be a Federal election year, there is a lot of pressure on the RBA by the federal government to decrease rates.
GDP per capita has continued to fall, with this being the 7th consecutive quarterly drop of GDP per capita.
Once the interest rate lower in 2025, I expect the house price growth to strengthen.
The Sydney market peaked in August and November was the second month of falls, down 0.2%. Growth also slowed in Brisbane which was up 0.6%, Adelaide 0.8 and Perth up 1.1%.
Number of properties available for sale has increased, with capital city listings up 16% since the end of winter, however capital city home sales have decreased over the past three months and is -4.6% lower than a year ago and -2.0% below the previous five-year average.
Rental growth has also slowed, rising 0.2% in November to be 5.3% higher over the past 12 months. This annual change in national rents was the smallest since April 2021. In 2023 rents were increasing at the annual rate of 8.1% and by more than 9% over the prior two years.
Gross rental yields across the combined capitals is now 3.47% and 4.38% for the combined regionals.
On a positive note, total superannuation savings hit $4.1 trillion at the end of September, up more than 13 per cent on the prior quarter, according to new data from the Australian Prudential Regulation Authority. With superannuation contributions at least 11.5% I expect this to continue the strong growth into 2025 and beyond.
As a result, we are seeing more people buying property in their SMSF or setting up a SMSF to enable them to purchase property, so if you would like to know more, please get in touch.
Many people review their property plans over the Christmas and New Year, so if you have any property purchasing plans for 2025, please get in touch. We wish you and your family a great Christmas and new year break and a prosperous 2025.
