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The new year is here. With that comes a new outlook. Many are anticipating the next 12 months will bring gains, while others are cautious of potential headwinds. Between talks of cash cuts, inflation, rising housing prices, a housing shortage, an election year and continued geopolitical tensions abroad, among other variables, there's a lot of uncertainty.
But the unknown doesn't necessarily signal bad news. In fact, depending on where one falls in Australia's property market – broker, lender, investor, homeowner, as well as geographical location within Australia – interpretations of the environment differ widely.
Nationally, housing prices are expected to rise between 4% and 6% this year, according to Domain’s 2025 Forecast Report. That could have major implications for both brokers and lenders, not to mention sellers. But not all cities Down Under are created equal. On the flip side, a standstill on rate cuts (for the moment) has led many buyers to play the waiting game.
With so many conflicting factors, planning for the future can be challenging. Australian Broker caught up with key players in the market to hear their thoughts on the year ahead. In a two-part series, AB asked some of the nation's top brokers and lenders to find out what they're expecting and how they're preparing for 2025. But just as Australia's housing market is diverse, so are expectations for the future. Starting with brokers, here's what a few had to say.
Melbourne-based head of commercial at My Mortgage Freedom, pictured above left
“I think 2025 will be an interesting year. With the upcoming federal election, it is common for people to adopt a wait-and-see approach, especially when it comes to major decisions like purchasing a home. Coupled with anticipated interest rate cuts and ongoing geopolitical uncertainties, there is a significant degree of unpredictability. Until further clarity emerges on these fronts, it seems likely that many will continue to hold off on making such significant commitments."
Newcastle-based director and broker at Money Links, pictured above centre
"It's going to be a challenging market this year. We're still feeling the impacts of higher interest rates and buyers are limited in what they can spend at the moment. What we're hearing is that a lot of people are preparing to sell in the new year. There's been a low level of supply on the market for the last six to 12 months. But it's going to be a moment before strong confidence returns."
Gold Coast-based managing director at brokerage firm Investure
"I think 2025 is going to be a solid year. We're anticipating 25%, year-over-year, growth. What we're hearing from builders, developers, is that they're predicting a bigger year; they're getting more stuff on the market. So market conditions are right; building costs are stable. Projects that were put on hold during COVID, they're going to be built next year. We're thinking next year is going to be a positive year. An interest rate cut will help and next year's election, midyear, could have a positive impact as well."
Founder of Queensland-based mortgage brokerage firm Capta Financial,pictured above right
"We will have a rate cut eventually. And when the rate cuts finally occur, then there will be an increase in the borrowing capacity. So I'm predicting a busy year."
Sydney-based executive chairman and chief executive officer at real estate firm Raine & Horne
“Demand remains strong, but the supply of properties is constrained by factors such as government red tape, a shortage of skilled tradespeople and high building costs. This scarcity, combined with sustained buyer demand, is likely to support property growth similar to 2024 into 2025, with growth of 4% to 6% now in prospect. An early rate cut in 2025 could be the magic catalyst for buyers, finally putting the interest rate genie back in its bottle and sparking them back into property buying mode. A rate cut either in February or early April could also set the stage for a strong autumn selling season.”
