- Survey of 1,400 real estate professionals reveal industry predictions for 2024
- Interest rates are thought to be the biggest market influence
- Real estate businesses fear the lack of properties will negatively impact them
Property data and analytics provider CoreLogic have just released the results of an industry survey undertaken by 1,400 real estate professionals in their “Decoding 2024: real estate’s trends and goals revealed” report. Designed to gain insights into the fears, strategies, and predictions of those in the property industry, results suggest an interesting 12 months ahead.
Fluctuating interest rates to shape the market
Over 70% of those surveyed believed that interest rate movements would be the biggest market influence this year. A majority pointed to rising interest rates as the main impact, with 12% feeling that decreasing rates could also drive activity.
Increased migration and population growth, along with housing supply and demand were also key factors predicted to affect the Australian market, with global events considered the lowest threat.
House prices predicted to increase slightly
Even though survey respondents believed the market to be at the mercy of interest rates, many were still positive that modest economic growth was on the cards, with 46% predicting house prices nationally to increase between 1-5%.
This correlates with mainstream forecasts of a smaller price growth in 2024 than in previous years. “The broad expectation is that the market will still grow, but at a slower rate than the 8.1% observed in 2023,” said Eliza Owen, Head of Australian Research at CoreLogic.
Owen believes the ongoing undersupply means home values will likely keep rising this year, with higher living costs and interest rates curbing the demand growth. However, any rate cuts from the Reserve Bank of Australia (RBA) could quickly see a boost in buyer activity again.
“There remains a strong mismatch in the supply and demand of dwellings across Australia, and anything that makes buying more accessible, such as a reduction in interest rates, would likely boost buyer numbers.”
Eliza Owen, CoreLogic
Lack of property listings remains a key challenge
When it came to identifying the biggest eternal stressors to their real estate businesses, 41% of survey respondents claimed that the limited listing stock was their biggest concern. Over a third also stated that the high interest and inflation rates would have the biggest negative impact on their business this year. New migration to the area, and more local competitors were considered to be the leading challenge for just 8% and 7% respectively.
Nurturing customers and embracing technology the way to success
When asked about their business goals for the year, deepening client relationships through more face-to-face interactions was seen as crucial by 80% of those surveyed. The second priority was making better use of existing CRM data to identify new opportunities. Two-thirds of participants wanted to leverage this untapped resource to drive additional business in 2024’s slower-growth environment.
Investing more in proptech was also on the minds of real estate professionals in a bid to increase productivity and gain that all-important competitive edge.
Industry research suggests Australian real estate technology investment will see 9.3% annual growth out to 2033. While proptech can streamline many tasks, Dr Sarah Bell, Principal, Innovation and Industry at CoreLogic, cautions that it should not come at the expense of in-person client interactions.
“One of the consequences of the explosion of proptech in real estate is that it has taken agents away from the driveways and pathways of their local marketplace and put them behind a screen, which is not where their customers want them to be,” Bell noted.
The key is finding the right balance of technology assistance without losing sight of the irreplaceable value of human relationships.