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Property prices could hit new high this year

If you were waiting for property prices to go down to buy your home, you may have missed your chance.

Australian currency fanned out and an aerial view of property in Sydney, mostly apartment blocks.
Property prices are on their way to hit a new high in early next year. (Source: Getty)

Property prices could reach a new all-time high by January 2024 if they continue to grow at the same pace they have been over the past three months, according to new data.

The latest PropTrack Market Insight Report found if national prices continued on the same path, they could return to positive annual growth in July this year and reach a new peak early next year.

The report said property prices were being pushed higher by an increase in international visitors coming to Australia and a lack of available properties going to sale.

“After five months of price growth, stronger market conditions are becoming more widespread in 2023,” the report said.

“Housing demand is stronger, likely bolstered by the surge in net overseas migration, as well as very tight rental markets. Given limited new stock is coming to market, buyer interest is being concentrated, which is underpinning home prices and offsetting the downward pressure from interest rate rises.”

Prices in Sydney quickly rebounded this year, and are already up 3 per cent from the low in November 2022.

If prices continue growing at the same pace, they will surpass their previous peak by December this year.

Both Canberra and Brisbane also recorded a rapid turnaround in prices. Home prices in Brisbane could be on track to surpass their April 2022 peak by September 2023, while Canberra could set a new record by November 2024 if growth continues at its current pace.

If more people sell their home, prices should drop

The report said prices should ease off if more properties became available to purchase to keep up with the higher population.

“Price growth may wane if stronger market conditions improve seller confidence and spark a boost in stock coming to market,” the report said.

Interest rate rises could slow price growth

The Reserve Bank of Australia raised the official interest rate this week to 4.1 per cent - a major rise since April last year when the cash rate was at a record low 0.1 per cent.

“Interest rates also rose again in June and may rise further, which could slow the recovery,” the report said.

“Though, interest rates are closer to their peak than not, and the shock of rate rises has lessened.”

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