From 2024 Stability to 2025 Opportunities

The 2024 property market ended much as it began – “normal” in terms of transactions across all price ranges and segments. Defined by balance, buyers and sellers primarily transacted for typical life events such as upsizing, downsizing, divorce, death, or tax considerations. Picture the market as a set of scales - sometimes tipping in favour of buyers, sometimes sellers - but 2024 largely maintained equilibrium.

Key factors supported this stability. The Reserve Bank of Australia (RBA) held interest rates steady throughout the year, providing much-needed predictability. Strong immigration strengthened demand, though this failed to offset challenges caused by a shrinking pool of investors. With more investors leaving the market than entering, rental pressures intensified, exacerbating the housing crisis and contributing to inflation.

In Victoria, rising compliance costs and regulatory changes made investment properties increasingly unappealing, with lifestyle markets like the Mornington Peninsula particularly affected. High property taxes and elevated interest rates caused prices to stagnate or decline from their previous highs. Discussions on property taxes dominated 2024, with little hope for relief given the state’s financial challenges.

Looking to 2025, the first half is likely to mirror 2024. Inflation remains high, cost-of-living pressures persist, and wage growth continues to lag. While interest rates are expected to hold steady, the ripple effects of property taxes and affordability pressures will remain critical areas to watch.

Despite these challenges, opportunities remain for savvy buyers. Those with a long-term view may capitalise on the current market, recognising that property cycles historically rebound over time. History shows that foundations for future growth often emerge in challenging times.

To make the most of these opportunities and navigate the market with confidence, get in touch with your local Marshall White team for expert guidance and tailored advice.

John Bongiorno

Marshall White Group Sales Director