As we head into another year, what are the predictions for the Gloucester region property market? It’s notoriously difficult to predict anything in this uncertain environment but I’m going to look at some broader trends that could affect our property market in 2024.
The sellers in 2024: Who will they be?
In 2023, we saw prices rise due mainly to lack of supply. Interestingly, accordingly to Eliza Owens who heads the research department at CoreLogic, different types of owners tend to sell depending on how the market is going. If you’ve owned your property for more than a few years, you are more likely to sell even if prices are stable as you will be making a profit. On the other hand, when house prices rise, if you’ve owned property for just a short time, you might also sell as you’ll see the potential for profit. Borrowing power is a factor for buyers. Most central banks feel that interest rates have peaked for the moment so any rate cuts will help buyers.
Who is moving to the regions? The affordability factor
As buyers seek more affordable housing, they’re looking to city outskirts and regional areas where they’ll get more bang for their buck. Buyers will look at not only house prices but also the potential for a region regarding infrastructure, housing and employment.
With the work from home opportunities, we saw a flight to regional areas. Initially, most of those were so-called prestige regional areas like Byron Bay, the Southern Highlands or the Hunter Valley. The premium beach regions had the highest price rises and also the highest falls once interest rates rose. Now the tree-change regions are benefiting from strong capital growth.
While many large corporations with city headquarters are reining in the extent of WFH days, there are still some industries that are supportive, plus we are seeing the move to regional is more than just WFH; local economies are growing, providing more local employment. Younger people with families are moving to the wider Barrington Coast region like the Gloucester area as it offers properties with beautiful outlooks and is still close enough to drive to a larger regional town like Taree for work.
Migration and regional Australia
Most of the demand from shorter-term overseas visitors is from students, who will need accommodation close to universities, or backpackers who tend to stick to the coast unless they’re working towards a two-year visa.
While migrants will put some pressure on the housing market, the construction, hospitality and healthcare sectors welcome a renewed migrant influx. In a recent survey of 2,115 business owners, 60% said they were affected by worker shortages. While at face value it might appear that Australia has unconstrained migration, many of those cited in the migration figures had entered Australia before the pandemic and they’re now applying for citizenship. This group is housed already so will have no impact on accessibility to housing.
Attracting more migrants to regional towns and cities is particularly vital for healthcare. The newcomers will likely try to buy property rather than rent given the acute shortage of suitable rental properties.
Women buying more real estate
As the pay gap narrows, more women have found they can afford to buy a property on their own. While most of them buy apartments in capital cities, in regional areas they buy houses as these properties are more affordable. (Interestingly, joint property ownership between a man and a woman dropped slightly in 2023.)
Boomers aren’t moving
In what is being described as a ‘Baby Boomer stranglehold’ on property, many of the Baby Boomer set are firmly entrenched in their family homes and they aren’t budging. There are several reasons. As their children leave home, the Boomer crowd are enjoying the extra space for hobbies or work. Most are reluctant to leave their communities. Finally, if they were to sell, they’d have limited stock from which to choose. So-called experts believe the bulk of the Boomers will be ready to downsize – in the 2030s. Those born in the mid 1950s will be into their 70s and looking for a new adventure and homes with lower maintenance needs.
Will 2024 be good or bad for sellers?
As I said earlier, predictions are only good until things change. According to the ‘Big Four’ banks, we will see national growth of between +3% and +5% this year. This growth is lower than that for 2023 but is approaching the average of the last 30 years.
Reality is, there are fewer quality properties on the market locally than 12-18 months ago. Buyers are more considered, they will take their time in making a decision, so FOMO (fear of missing out) has definitely gone from the current market and buyer price expectations have dropped slightly. The property cycle is just returning to its normal heartbeat, with potentially longer days on market.
What does that mean if you want to sell? Review the 3 Ps. Price ‒ do you need to adjust your price expectations? Compare properties sold with recent sales, not ones sold 12-18 months ago. Have stunning photos (Presentation) and have a targeted marketing program (Promotion).
Need advice on selling your Gloucester region property?
As a proud local, I’m here to guide you through the process of selling your home. I specialise in lifestyle, rural and residential properties. I’ve done it myself and helped many families over my career. So give me a call; I’m here to help.