Property prices continued to surge across Australia due to a significant lack of supply, despite ambitious government targets to construct 1.2 million new homes within the next five years, with reality falling short of expectations, according to PIPA.
“I have a better chance of winning Lotto next week” than seeing these housing goals achieved, said PIPA Chair Nicola McDougall (pictured above), expressing her skepticism about meeting these targets.
Migration fuels demand, supply lags
ABS reported an overwhelming net overseas migration figure of 550,000 in the year ending September. The influx, coupled with high population growth, has exacerbated the housing shortage, causing prices to rise and rental markets to tighten.
McDougall slammed the current policy settings, suggesting, “Not only does that tap need to be turned off dramatically, but more needs to be done at a policy level to encourage investors back into the market to help remedy the rental catastrophe.”
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In Perth, although the market juggernaut may be slowing, median prices have yet to reflect a cooldown.
“We see Brisbane as the likely leader in property market investment prospects, with Adelaide and Sydney close behind; Perth starting to slip down the rankings,” said Terry Ryder of Ryder Research Resources.
The Housing Industry Association’s latest report revealed a concerning trend with new home sales down significantly from past years.
Senior economist Tom Devitt highlighted that high land costs, especially in New South Wales and Victoria, have contributed to a downturn in sales.
“Lowering the cost of delivering new homes to market is essential to achieving the Australian government’s target,” Devitt said.
Despite the challenges, some regions still offer promising investment opportunities. Areas like Orelia in Kwinana have shown impressive growth, and Adelaide continues to attract investors due to its affordability and ongoing infrastructure developments.
Peter Koulizos, from The University of Adelaide, projected that Adelaide’s median dwelling values will soon surpass those of Melbourne, driven by strong local growth and strategic investments, PIPA reported.
To read the PIPA article in full, click here.
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