Hotspotting

Regional Victoria continues to display resilience and consistency in line with its reputation, although the overall trend in the market lately has been weaker.

And we continue to see good prospects for specific locations in Regional Victoria, with the impact of 2026 Commonwealth Games a significant factor.

Over the past six months, we have noted that the Regional Victoria market overall has weakened compared to the previous quarters – but that it had remained solid in the face of the downturn pressures which have afflicted Melbourne.

Consistency of performance is the key characteristic of the Victoria market.

Grab a copy of the latest Top 5 Victoria Regional Hotspots and discover the markets with the best prospects for future growth.

There are many myths and misconceptions about what works best in real estate.

There are those who believe that you need to be close to the CBD or to buy in the expensive so-called prime suburbs to get the best capital growth, but the research data shows that this is nonsense.

Many Australians think that you need to buy in the capital cities, rather than regional areas, for superior price growth, but the regions have been out-performing for many years now.

The old paradigm that houses on land deliver better capital growth than attached dwellings like units and townhouses has been challenged by the results of the past two years, including recently during the times of rising interest rates.

And there are those who cling to the notion that you have to buy in the biggest cities, specifically in Sydney and Melbourne, to get the best long-term capital growth.

That one is a serious misconception as well.

Of the many definitions of “economist”, the best of them claims that an economist is someone who will tell you tomorrow why what they predicted yesterday didn’t come true today.

This reality of economists constantly getting it wrong with their forecasts, but refusing to admit they were wrong, is seen pretty much every day in Australia.

The property data from multiple research sources is becoming increasingly positive – not that
it’s ever been as negative as mainstream media has portrayed.

A more optimistic outlook for real estate markets is being seen in data on sales activity,
auction clearance rates and prices.

These more positive outcomes have occurred despite 10 consecutive interest rate rises by the
Reserve Bank - and pre-date the RBA’s decision to pause the rate rises at its April board
meeting.

And it’s worth re-iterating that, right throughout this period of continual rate increases, many
major markets in Australia have continued to deliver rising sales activity and rising prices.

Perth, Adelaide and Darwin in particular, as well as many of the regional markets, have
continued to defy the downturn pressures that have been most evident in Sydney and
Melbourne.

Perth is the nation’s strongest property market.

At a time when the market in our biggest capital cities have been struggling, Perth has continued to thrive.

Amid all the disruption that’s been afflicting property markets across Australia, Perth is still delivering strong sales activity and price growth.

We’ve just completed our latest quarterly analysis of sales activity – and it shows that two-thirds of suburbs in the Greater Perth area have maintained high levels of sales activity in defiance of the nationwide downturn pressures.

Of the 194 Greater Perth suburbs in our analysis, 63 are classified as rising markets and another 63 are consistency markets.

To have two-thirds of locations maintaining strong buyer demand is exceptional in the current climate of economic disruption.

Get the latest Top 5 Perth Hotspots report for all the details on Perth's strongest suburbs.

A growing number of positive indicators are emerging from the real estate industry, providing confidence that the worst may be over for those markets that have been in decline for the past 12-18 months.

It’s worth noting that not everywhere in Australia has been in downturn lately.

Far from it – our latest quarterly analysis of sales activity shows 20% of suburbs and towns have rising sales volumes and another 22% have consistent buyer demand.

On Monday 27 March the ABC television program 4 Corners ran an expose on its own shallowness and shabby journalistic standards.

The ABC personnel who put this piece of tabloid television together probably imagined they were crafting an expose of the residential property industry.

It could have been that if the ABC had adhered to quality journalistic standards – but those days are long since past, it seems.

It was titled “Agents of Influence” and it purported to expose the dirty hidden secrets of the industry that manages the sale of homes.

There were a few problems however.

Misinformation about real estate is rife in Australia, to the extent that most of the nation’s citizens are utterly and constantly confused about what is really going on in our housing markets.

But the single worst piece of misinformation of all, among the many that afflict Australian consumers daily, is a report published each year under the title of Demographia.

Every year this report claims that Australia has the most unaffordable homes in the world, or close to it.

And that Australia’s largest cities are among the most unaffordable in the world – with Sydney currently claimed to be the second most unaffordable city on the planet.

But here’s the key point: this report doesn’t produce any evidence to back up its spectacular claims about where Australia sits in the world of real estate.

Media continues to discuss the downturn in “the Australian property market”, but our analysis confirms there are many different scenarios playing out across Australia.

There really is no such entity as “the Australian property market” – because it’s normal to have, at any point in time, markets which are rising, markets which are stagnating and markets that are falling.

This is certainly the case right now in Australia. This is the norm for residential real estate in this very large and diverse country – and it’s nonsense for economists to speak of “Australian property prices” rising 10% or falling 10% – because there is no national market situation.

This reality is illustrated vividly by the quarterly editions of The Price Predictor Index, in which we analyse thousands of housing markets throughout Australia to determine the patterns with sales activity, which means buyer demand.

We do this because sales volumes are a forward indicator of what will happen with prices.

Rising transaction levels are usually a precursor to property price growth.

Equally, if sales activity is falling, price growth will slow, or stop – or prices may fall.

So, right now, our quarterly analysis shows that there are markets that continue to rise, many that remain consistent despite all the disruption, others that have tapered off at levels below the previous peak and some that are showing distinct patterns of decline.

This is “situation normal” in Australian real estate.

Across Australia, there are close to 500 towns and suburbs where sales activity is rising and over 500 more with consistent market performance.

Our new Autumn 2023 edition of The Price Predictor Index shows that Perth, Darwin and Adelaide are the strongest capital city markets, while Canberra and Melbourne are the weakest overall.

So get yourself a copy of  The Price Predictor Index.  It’s a great way to be informed about individual markets right across Australia – and their prospects for 2023 and beyond.

 Get your copy at https://www.hotspotting.com.au/product/price-predictor-index/

The State Government in Queensland has been devoting itself recently to demonstrating why Australia has a rental shortage crisis.

Vacancy rates are the lowest ever recorded and rents are rising in most markets across the nation - because the people who supply rental properties have been consistently and systematically discouraged by the actions of politicians.

The leadership of the Queensland Government provide headline examples of the problems.