The relative confidence of both buyers and sellers is a significant driver of the property market, influencing not only the volume of listings and transactions but also the price trajectory of properties. While sentiment can fluctuate, recent data from the realestate.com.au Residential Audience Pulse Survey highlights several positive trends within the housing market.
Seller Sentiment: Strong But Beginning to Soften
Recent survey results reveal mixed sentiments among sellers, with some expressing reservations about the market, especially in New South Wales (NSW) and Victoria, where price growth has been modest. However, in Tasmania, sellers have shown growing confidence, with the number of sellers who consider it a good time to sell increasing by 15% in October.
Tasmania’s housing market has been performing differently from other states, with prices continuing to grow while markets in other regions are slowing. Despite varying sentiments across states, the spring selling season of 2024 outperformed the previous year, reflecting the resilience of the market, as both buyers and sellers remained active despite fluctuating confidence.
In Western Australia, sentiment remains notably strong, especially in Perth, where property values grew by 17.6% over the past year. Sellers in this region are motivated by personal circumstances and the current high prices.
Buyer Sentiment: Optimism Persists in Some Regions
Buyer sentiment has largely remained steady, with about one-third of buyers feeling confident that now is a good time to purchase. Victorian buyers, in particular, are optimistic due to a plateau in price growth, with 40% affirming it’s a good time to buy. South Australia (SA) has seen a surge in buyer confidence, up by 48%, while Queensland has also experienced an increase in buyer sentiment, with nearly one-third of buyers feeling positive about the market.
Notably, buyers are primarily motivated by a desire for larger properties, with one in five aiming to upsize. Additionally, Australia’s aging population is contributing to a growing demand for downsizing, influencing development trends towards luxury apartments and retirement living.
Demand for properties in regional areas of South Australia and Queensland is also rising, driven by lifestyle changes such as a desire to live closer to the beach or mountains. Affordable pricing in these regions, compared to urban centers like Adelaide and Brisbane, has helped boost buyer sentiment.
Interest Rates and Market Outlook for 2025
Interest rate expectations play a crucial role in shaping market sentiment. Buyer expectations for rising interest rates have decreased, with only 16% anticipating hikes in the next six months. A significant 67% expect rates to stabilize or decrease. Sellers are also optimistic about interest rates, with 72% expecting them to remain stable or fall, further strengthening seller confidence.
This shared optimism toward interest rates suggests continued market engagement and transaction activity. However, while some buyers and sellers may wait for the market to become more favorable, most will transact when the timing is right for them. This resilience, particularly in regions like Tasmania and Western Australia, offers an optimistic outlook for the housing market in 2025.
Conclusion
Despite a slight decrease in consumer sentiment, which may moderate price growth in 2025, areas with strong performance, such as Tasmania and Western Australia, coupled with sustained buyer interest and easing concerns over interest rates, suggest a continued positive trajectory for the housing market. PropTrack has predicted continued price growth throughout the year, underscoring the resilience of the market.
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