Sydney and Brisbane Property Market Report – July 2024

Sydney CBD view from Sea

By Byron Rose, Rose and Jones

 

Market Performance Overview

The property markets in Sydney and Brisbane have demonstrated distinct patterns and performance metrics for June 2024, reflecting both regional dynamics and broader economic trends. Today, I will explore some key statistics to provide a comprehensive overview of the current state of these markets.

 

Sydney Market Analysis

Market Performance Sydney’s property market exhibited resilience amidst economic fluctuations. According to CoreLogic’s data, Sydney’s dwelling values rose by 0.6% over June 2024, contributing to an annual growth rate of 4.5%. This steady increase underscores the city’s robust market despite prevailing economic uncertainties.

Price Trends Sydney’s median dwelling value reached $1,052,338, maintaining its status as Australia’s most expensive capital city market. Houses experienced a monthly growth rate of 0.5%, while units saw a 0.7% rise. This gradual appreciation indicates a stabilisation phase, with incremental increases reflecting cautious optimism among buyers and investors.

Auction Clearance Rates Auction clearance rates in Sydney remained strong, averaging around 70% throughout June. This high clearance rate highlights sustained buyer interest and competitive bidding, particularly in inner-city and eastern suburbs. Such robust activity signifies a healthy demand, reinforcing Sydney’s market strength.

Sales Volumes Sydney’s sales volumes showed a 2.3% month-on-month increase, signalling growing market activity and buyer confidence. The upper quartile of the market saw higher transaction rates, indicating ongoing interest in luxury and high-end properties. This trend suggests that despite affordability challenges, premium market segments remain attractive to investors.

Rental Market The rental market in Sydney continued to be tight, with vacancy rates at approximately 1.7%. This scarcity has driven up rental prices, with the median rent for houses at $660 per week and units at $520 per week. Rental yields stand at 2.6% for houses and 3.8% for units, offering solid returns for investors in a constrained market.

 

Brisbane Market Analysis

Market Performance Brisbane’s property market also showed positive momentum, with a monthly dwelling value increase of 1.2% in June 2024, contributing to an annual growth rate of 6.8%. This robust growth highlights Brisbane’s appeal as an affordable alternative to Sydney and Melbourne, attracting a diverse range of buyers.

Price Trends The median dwelling value in Brisbane reached $732,500. Houses in Brisbane experienced a growth rate of 1.3% over the month, while units increased by 0.9%. These figures reflect a balanced growth trajectory, with both housing types benefiting from the city’s expanding population and economic opportunities.

Auction Clearance Rates Brisbane’s auction clearance rates were around 65% in June, slightly lower than Sydney’s but still indicative of strong buyer demand. The steady clearance rates point to a competitive market environment, particularly in suburban areas where affordability remains a key driver.

Sales Volumes Sales volumes in Brisbane increased by 3.1% compared to the previous month, showcasing heightened buyer activity. The middle market segments showed notable activity, driven by both local buyers and interstate migrants seeking value for money. This trend highlights Brisbane’s attractiveness for those looking for more affordable property options.

Rental Market Brisbane’s rental market remained under pressure with low vacancy rates at 1.9%. The median rent for houses was $520 per week, while units commanded $420 per week. Rental yields were attractive, with houses at 3.5% and units at 4.5%, drawing investor interest in a market characterised by solid demand and limited supply.

 

Factors Influencing the Markets

  • Economic Conditions Both markets are influenced by broader economic factors such as interest rate fluctuations and inflationary pressures, impacting buyer affordability and borrowing capacities.
  • Federal Budget Impacts The recent Federal Budget had mixed effects on both markets. Enhanced borrowing capacities due to tax cuts have boosted buyer activity, yet the lack of substantial reforms in rental assistance and construction sector support presents ongoing challenges.
  • Population Growth Both Sydney and Brisbane continue to experience strong population growth, driving demand for housing and underpinning long-term market stability and growth.

 

Challenges and Opportunities

  • Affordability and Supply Issues Affordability remains a significant challenge, particularly in Sydney. The construction sector in both cities faces supply chain disruptions and labour shortages, affecting new housing project timelines.
  • Investment Prospects Despite challenges, opportunities abound, particularly in luxury properties in Sydney and more affordable segments in Brisbane. The tight rental markets in both cities also offer attractive yields for investors.

 

Summary.

The Sydney and Brisbane property markets in June 2024 demonstrate resilience and growth amid economic challenges. With stable price trends, robust auction clearance rates, and tight rental markets, both cities continue to attract buyers and investors. Addressing affordability issues and supporting the construction sector will be crucial for sustaining long-term growth and market stability.

As a buyer’s agent at Rose & Jones, I recommend staying informed and agile to navigate these dynamic markets effectively.

Source: CoreLogic. (2024).

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