Approvals vs Reality The Housing Crisis Explained
Hotspotting
One of the many ways media misinforms Australian consumers is their misunderstanding of the difference between building approvals and actual construction of new dwellings. Right now, at a time when we have major dwelling shortages and construction costs are so incredibly high, there is a very important distinction between the number of dwelling approvals and the number of homes actually being built. The difference between the two is quite stark and it speaks to the biggest single problem amid the housing crisis – approvals often are not translating into actual construction of homes, because...
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Why Apartments Are Booming in 2025
Hotspotting
The Great Australian Dream still exists, it’s just that - for many - it now means owning an apartment, not a house with a white picket fence. As property prices continue to grow, the dream of owning a freestanding house has morphed into the dream of owning an apartment - for more and more Australians. Apartment living is no longer just a financial choice, but a conscious decision to seek out a different way of living - a more affordable and low-maintenance lifestyle. The percentage of Australians who live in a freestanding house has been declining since the beginning of the new...
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Brisbane: Australia’s Hottest Market
Hotspotting
Brisbane was one of the nation’s boom markets in 2024 and likely to do even better this year. The price data shows that Brisbane delivered a strong performance last year, both with house prices and in particular unit prices – but was third in the capital city growth rankings behind Adelaide and Perth. Figures from PropTrack and CoreLogic show Brisbane house prices overall were up 10% last year and unit prices around 15%. In 2025 we expect Brisbane to have another strong year and to overtake those other cities to be the national leader on price growth. ...
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Australia’s Housing Crisis – How Did We Get Here & How Do We Fix It? | The Property Playbook
Hotspotting
🏡 Australia's Housing Crisis: Causes & Solutions With housing affordability at record lows and supply failing to keep up with demand, how did Australia's property market reach this crisis point? More importantly—how do we fix it? In this special episode of The Property Playbook, Tim Graham is joined by an expert panel to tackle one of the most pressing issues facing Australian homeowners, investors, and renters: 🎙️ Panel Guests: ✅ Michael Sukkar – Federal Shadow Housing Minister ✅ Kelly Ryan – CEO of the Real Estate Institute of Victoria (REIV) ✅ Terry Ryder –...
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Mining Towns
Hotspotting
Some investors are attracted to the cheap house prices and very high rental yields in resources sector towns but recent events in two of the nation’s iconic locations demonstrate why this can be a strategy fraught with peril. Hotspotting methodology dictates that a diverse economy is a core factor in any location we are willing to recommend – which means locations dominated by one industry sector seldom make it to our hotspots reports. A country town solely reliant on agriculture, a coastal enclave where everything depends on tourism and mining towns are all places we shy...
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Shallow Analysis
Hotspotting
I sometimes despair for Australians trying to make sense of real estate markets, when the standard of analysis and commentary in news media is so poor. Knee-jerk responses to short-term data sets from economists, journalists and often from the big-name research houses create a mass of confusing, conflicting and contradictory commentary. The commentary around price data is the worst example of this. For a long time, the biggest problem for consumers trying to make sense of market events has been commentators putting too much importance on short-term results. ...
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Regional QLD: 2025’s Hottest Market?
Hotspotting
Regional Queensland had a pretty good year for price growth in 2024 but I’m predicting it will have an even better one in 2025. There’s mounting evidence that the combined weight of internal migrants moving to Queensland and investors increasingly pivoting from Western Australia to Queensland will drive significant price uplift this year. In 2024, according to PropTrack figures, the median house price for Regional Queensland increased 10%, which was well above the national average (4%), and better than our three biggest cities, but was slightly below the level of growth achieved in...
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Next $1M Suburbs Revealed!
Hotspotting
Since the start of the pandemic in 2020, many of Australia’s property markets have experienced some extraordinary price growth. Many locations, both city-based and regional, achieved unprecedented price increases with median house and unit prices soaring as demand hit new highs. Where once a million-dollar house or unit median was unusual, that recent growth launched many locations into that club for the first time. As of January 2025, there were 1,194 suburbs or towns with a median house price or median unit price of $1 million or more – 50 more than in September 2024. These figures show...
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Chalmers vs. Landlords: Who’s Right?
Hotspotting
Was the Federal Treasurer being serious when he suggested that investors pass on the new interest rate cut to tenants in the form of cheaper rents? Has Jim Chalmers lost the plot completely or was he making a shallow pitch to voters on the eve of a Federal Election? To suggest that investor owners are in a position to hand out financial benefits to tenants because of this one, very small, isolated reduction in their costs suggests that Chalmers is either divorced from reality or he’s having a cheap shot at landlords to win favour with renters and maybe a few extra votes. I have to say that...
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$1 Million Homes: Australia’s Housing Crisis
Hotspotting
One of the most significant housing stories in the past year has slipped under the radar of news media, with very little commentary. The latest official data from the Australian Bureau of Statistics shows that it now costs over $500,000 to build the average house in this country. That’s the cost of construction of the dwelling and doesn’t include the land price. Given that the price of residential land is also escalating to record price levels, the reality is that the typical house and land package in a capital city is beyond the reach of most young buyers. This, in...
info_outlineRumours 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 growth.
This is situation normal in Australian real estate. It’s a big country and real estate markets are very local in nature.
So, a national property boom? We haven’t had one. So you ignore headlines declaring that the national property boom is over.
So, what can we expect in residential real estate in 2025?
Firstly, the major bank economists will predict price declines in 2025 – as they did at the start of 2023 and again at the start of 2024 - and will be proven wrong yet again because it they fail to understand the basic dynamics that drive prices in residential real estate.
Politicians will continue to scapegoat their traditional targets of foreigners (migrants, international students and foreign investors) as well as mum-and-dad Australian investors – and enlist the help of shallow journalists to infer that these cohorts are the cause of all the problems in the housing markets.
The reality is that investors, local and foreign, are not the problem – they are the solution. They hold the keys to solving the housing crisis.
Meanwhile, most State Governments will continue to make the housing crisis worse with anti-investor policies - with the negative ramifications of recent rental reforms to become more apparent as 2025 unfolds.
Vacancy rates will remain low, but the rate of rental growth generally will slow because markets have hit a ceiling due to limits in the capacity of tenants to pay more.
However, restrictive rental legislation by various state and territory governments will continue to motivate some investors to sell up – thereby making the rental shortage worse.
The Greens will continue to embarrass themselves and lose voter support with anti-investor rants, with the Federal Election due early in the year likely to see their influence reduce even more.
Investors will continue to pile into the frenzied markets, mostly in regional Queensland -however, the smart money will target locations early in the growth cycle, not at the end.
Evidence that the Perth market has passed its peak will become more apparent with a similar slowdown forecast for regional WA.
The solid economic and market fundamentals in Adelaide means it will continue to show solid growth next year as well as Brisbane and regional Queensland.
Melbourne did not have a good year in 2023 or in 2024, but I believe it will start to rise next year, thanks to the price differential with Sydney and its high population growth. This will occur despite Melbourne having the worst state government and the highest taxes in the nation.
Darwin will be targeted by investors and will begin to show some price growth next year, too. More and more indicators are favourable for the Northern Territory capital, with investors seeking its affordable houses and high rental yields.
The Exodus to Affordable Lifestyle will continue, boosting many regional markets, as more big city residents seek a different and more affordable way of living, enabled by technology and the ability to work remotely.
What we have termed the ‘second-wind markets’ will ignite.
These are locations where the market sprinted (with major price growth) from 2022 to 2024, has been catching it breath since then, and now, having got its second wind, is starting to run again.
They include regional cities such as Albury-Wodonga and Tamworth in NSW, the Sunshine Coast and Hervey Bay in Queensland, Bendigo and Ballarat in Victoria, as well as Launceston and Burnie in Tasmania.
There will continue to be a lot of conjecture about interest rates next year, but the potential impact of any rate reductions will be largely irrelevant and greatly over-rated by many economists and news media.
As we’ve learned from the past two years, trends with interest rates are not the major influence on real estate outcomes.
If they were, prices would have fallen everywhere over the past two years.
And that, clearly, has not been the case.