Understanding Australia’s Property Investment Trends in 2024

The 2024 landscape for investors in the Australian property market is experiencing a dynamic shift - with contrasting trends shifting investor behaviour. While some investors are exiting due to economic challenges, new investment purchases are on the rise, creating a complex narrative.

The data available, thanks to the CoreLogic research team, stipulates that investor loans have surged by 18.8% in the past 12 months, reflecting heightened demand for investment property.

However, regional differences are striking - high growth states such as Queensland, Western Australia and South Australia, are seeing the influx of new investment purchases.? And in contrast, areas like Victoria, New South Wales, and Tasmania, where property values are stagnating or declining are recording elevated investor listings as more owners exit the market.

The state of Victoria is facing a unique challenge - reduced land tax threshold and softer capital growth deterring investment. Meanwhile, Tasmania has had a rise in property listings, which can be attributed to falling house prices and higher interest rates. Also New South Wales investment listings were 7.2% above average. Despite these challenges for investors in Victoria, New South Wales and Tasmania, demand is still strong in the high-growth states of Queensland, South Australia and Western Australia, where housing values are increasing.

Interestingly, the standard profile of the property investor is changing. In terms of the Reserve Bank of Australia, they have noted a shift towards less leveraged buyers, and more “first-time investors” entering the market. For September 2024, there were 711 first-home buyer loans recorded (Australia wide) for investment purchases, reflecting a trend toward investment properties as a more affordable entry point.

Envisaging what’s ahead, the property investment landscape may cool slightly.? While overall investor loans have surged by 18.8% in the last year, declining loan commitments since April suggest that affordable, high growth opportunities are narrowing.

In conclusion, the property market and its environment is changing, its investor profiles evolving along with it.? While certain challenges in the market remain, the resilience of investor demand further shows confidence in the property market is still strong.