KPMG Property Report Reveals Real Estate Prices in Australia to Rise by 4.9% in Next 9 Months

KPMG has shared its economics report which finds house / property prices are expected “to rise gradually over next nine months and then surge in FY25.”

In Australia, home / real estate prices will “rise nationally by 4.9% over the next 9 months and then surge by 9.4% in the year to June 2025,” KPMG’s new property report on Australia’s capital cities finds.

Apartment prices across the country “will see an average rise of 3.1% by next June, then a 6% increase in the next 12 months.”

But there will be important regional differences, “with Perth houses rising the highest – by 8.4% – in the rest of FY24 but then Hobart overtaking other cities in FY25 and surging by 14.2%.”

Hobart units also “outperform all other capital cities with rises of 8.7% and 10% respectively over the next two years, followed by Sydney, Melbourne and Adelaide.”

The report details the varied pressures “impacting on property prices, with a range of push and pull factors countering each other – but with limited supply and high demand ultimately outweighing interest rates.”

Dr Brendan Rynne, KPMG Chief Economist, said:

“Despite high interest rates, constrained supply will likely dominate the factors influencing property prices in the short term and result in continued price gains in most markets during FY24. House and unit prices will then accelerate further in the next financial year as dwelling supply continues to be limited, due to scarcity of available land, falling levels of approvals and slower or more costly construction activity.”

As noted n the update:

“There are some factors pushing the other way – the main one being mortgage stress. First-time buyers now need to use around half their earnings on mortgage payments – a significant rise from a third just 3 years ago. We estimate around $350 billion of mortgages, or half of all fixed rate credit will expire this year – covering 880,000 Australian households.”

Dr Rynne concluded:

“Based on our projections for new dwelling completions and the Treasury’s population forecasts, we estimate that annual rent growth will be 5.6% over the next two years – which is 2.5% higher than the long-term average of 3.1%.”

Register Now!
Sponsored Links by DQ Promote



Send this to a friend