Approvals V Construction
Hotspotting
Two very different headlines have summed up the problems for Australia’s ongoing housing shortage. One of the recent media headlines declared that building approvals were at a two-year high and that things were improving for the nation’s housing shortage. The other described why building approvals are almost irrelevant – it said that project deferrals are occurring at a record rate. The reality of the current crisis is this: it doesn’t matter how many houses and apartments are approved for construction – and it doesn’t matter how many re-zonings state governments push through...
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Webinar Replay: Reflections & Projections - A Deep Dive into Real Estate Trends & Forecasts
Hotspotting
In this insightful webinar, Terry Ryder, founder of Hotspotting, and Tim Graham, Hotspotting’s General Manager, analyze the surprises and trends of 2024 in the Australian property market and share their projections for 2025. With decades of combined experience, they provide investors with actionable advice on navigating the coming year. Key Highlights 2024 in Review Defying Predictions: Despite high interest rates and inflationary pressures, property prices rose by an average of 5.53% nationally in 2024. Perth led with an astonishing 18.7% growth, followed by regional Western Australia,...
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Best Buys Result
Hotspotting
You don’t have to be super rich or invest $1 million to make big capital gains in residential real estate: you just need to follow Hotspotting’s signature report, the National Top 10 Best Buys report. Those who followed the tips in our report of a year ago could have made close to $100,000 in capital gains spending as little as $400,000 – or $180,000 in gains after investing $630,000. In December 2023 we published our National Top Best Buys reports for Summer 2023-34. Our top 10 locations for investors to consider covered a wide range of price points, from less than $300,000 and above $1...
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Listings Rise
Hotspotting
The greatest complaint heard most often in real estate across Australia is that there are plenty of buyers, but a shortage of listings. The number of properties for sale has been well short of the levels needed for a balanced market, particularly in the boom cities of Adelaide, Brisbane and Perth. But that is steadily changing. According to SQM Research, total listings of properties for sale nationwide grew 7.6% in November and are now more than 10% higher than a year ago. Perhaps most significantly, there were major rises in November in those three boom cities, with the...
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Media Absurdities
Hotspotting
Things are constantly changing in real estate nationwide but the one factor that never changes is this: we can always rely on news media to distort the facts and deliver a steady flow of misinformation to Australian consumers, all in the interests of attracting readership, with little regard for accuracy, honesty or fairness. The past week or so has been chockful of media nonsense. If you can believe the headlines, the national property boom is over, house prices are plunging, the rental boom is over and the North Queensland city of Townsville is a mining town. One of the constants of my...
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2025 Predictions
Hotspotting
Rumours of the death of ‘the national property boom’ are greatly exaggerated – especially since we didn’t have a national property boom in 2024. Rather, over the past 12 months, we have seen differing market cycles in many locations - as is the usual state of play in real estate throughout Australia. Strong property price growth was recorded in Perth, Adelaide, and Brisbane in 2024, but not in Melbourne, Sydney, Canberra, Darwin or Hobart. Similarly, in the regional areas, there were declining and stagnating markets, as well as some where prices were showing good price...
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Regional Investment Boom
Hotspotting
Victoria’s real estate market is witnessing a significant shift as young first-home buyers increasingly seek affordable housing in regional areas. According to recent data from the Australian Bureau of Statistics (ABS), first-home buyer loans in Victoria soared to 4,202 in July – the highest number in nearly two years. This surge reflects growing confidence among young buyers and a trend towards exploring housing options beyond Melbourne. Nationally, the Commonwealth Bank of Australia and the Regional Australia Institute report that the flow of people from cities...
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Units Beat Houses
Hotspotting
Hotspotting was among the first to identify and highlight the most significant change in the Australian real estate scene – the emerging trend which we document in the quarterly editions of the report titled The Rise and Rise of Apartments., published in association with Nuestar. This trend has turned upside down the dominant paradigm in real estate, that houses out-perform apartments on capital growth. There is now growing evidence that attached dwellings are mounting a strong challenge to houses. It has long been believed that land content was the big thing in driving...
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Why a Buyer’s Agent Is a Game-Changer for Property Investors | Featuring Chris Graham
Hotspotting
Thinking of buying property on your own? 🏡 In this episode of The Property Playbook, host Terry Ryder is joined by Chris Graham, Senior Property Advisor at Australian Hotspot Advocacy, to explore why engaging a buyer’s agent could be the key to securing your next winning investment. What You'll Learn: What a buyer’s agent does and how they work exclusively for the buyer’s interests. The value of off-market properties and how buyer’s agents can provide access. Why having a professional on your team ensures due diligence and avoids costly mistakes. How to identify a trustworthy...
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Melbourne Market Myths
Hotspotting
Melbourne’s property market remains the great under-achiever of the nation but that may be about to change. A number of key indicators suggest better performance by the Melbourne property market is imminent. One pointer to better times is the latest Property Sentiment survey by API magazine, which recorded a major turnaround in investor attitudes towards the Victorian property market. The survey asked: Which state or territory do you regard as having the best property investment prospects for the next 12 months? Mid-year Melbourne and Victoria attracted only 8.6...
info_outlineThe new Spring edition of The Price Predictor Index provides emphatic confirmation of the most compelling trend in Australian real estate: the escalating demand for apartments and their challenge to houses on capital growth performance.
We have been speaking about the rise and rise of apartments for the past 18 months and there is a growing body of evidence which confirms that more and more buyers are opting for attached dwellings: units, apartments and townhouses.
Our analysis of sales activity data for the latest quarter for the Spring edition of The Price Predictor Index reveals that this trend is dominating markets across Australia.
For example, there is a stark contrast in the Sydney market. In simple terms, unit markets are pumping and house markets are not - and the market share of attached dwellings continues to rise.
In most of the Greater Sydney areas where sales activity is strong, it’s the unit markets that are most active. Outer ring house markets are generally subdued, suggesting that those seeking affordable options are choosing apartments and townhouses.
The dominance of attached dwellings in Sydney market performance can be seen in various metrics. While 45% of locations with house markets have positive (rising, recovery, consistent) rankings in this analysis, 67% of unit markets are positive.
This coincides with further evidence that a growing share of dwelling sales in the Greater Sydney market are attached dwellings. Comparing the June Quarter results for the past four years, the market-share of units was 48% in 2021, 50% in 202, 52% in 2023 and 54% in 2024. There’s a pretty clear pattern emerging there.
Sydney’s experience, with attached dwellings outperforming detached, is part of a strong national trend that is also evident in other cities and some of the regional jurisdictions.
In the Brisbane City LGA, elevated demand for units is driving overall activity. In Melbourne, which overall continues to under-achieve, a key exception is provided by inner-city unit markets. And Canberra is experiencing a similar scenario.
While just over half of Canberra markets overall have positive ratings, 78% of unit markets have rising, recovery or consistent classifications based on sales activity trends. Of the 36 unit markets in our Canberra analysis, only 3 have negative ratings.
While only 35% of house markets are classified as rising markets, 61% of unit markets in Canberra have this rating.
Affordability is likely a major driver of this trend. Canberra has a median house price close to $1 million (PropTrack data), higher than Melbourne and Brisbane. But its median unit price is $605,000, notably cheaper than Melbourne, Brisbane and Sydney, and on a par with Adelaide. The market share of units is rising year by year and attached dwellings now account for 44% of dwelling sales in Canberra, compared to 41% in 2021.
In booming Perth, the strongest markets in Perth now are well-located locations with a major presence of attached dwellings.
While the most popular house markets for home buyers and investors (mostly those at the affordable end of the market) are a little less buoyant than earlier in the Perth up-cycle, the focus is switching for affordable units.
Perth started this boom with a reputation as the most affordable capital city housing market. After a couple of years of stellar price growth, that’s no longer the case. Perth is now well above Hobart and Darwin with its median house price and challenging Adelaide.
Perth now has a median house price of around $800,000, but its median unit price is in the low $500,000s, still well below that of Hobart and Adelaide.
When the bargain suburbs have house medians above $500,000, the big attraction that caused the stampede starts to fade. So now buyers in Perth, increasingly, are looking at unit markets, which are less competitive than the house markets.
So now units are capturing a growing market-share in Perth, similar to the scenarios in Sydney, Melbourne, Brisbane and Canberra.
And units are out-performing.
In the new Spring edition of the Price Predictor Index, 29% of Perth house markets are3 classified as rising but almost 50% of unit markets are ranked as rising, based on trends with sales activity.
Clearing, the trend with more and more buyers opting for attached dwellings over detached houses, is gathering momentum.
It’s a major paradigm shift in Australian real estate – and at Hotspotting we believe this trend is here for the long term.