Interest rate cycle cuts to start in 2024
LJ Hooker head of research Matthew Tiller expects the interest rate cycle cuts to begin near the end of 2024. Image: Canva.
  • Home values are forecast to increase in 2024 even with reduced borrowing capacity.
  • The first interest rate cut is expected at the end of 2024, the first since early 2020.
  • Matthew Tiller predicts which suburbs are poised to do well in 2024.

Australia’s house price growth is forecast to remain on an upward trajectory throughout 2024, according to LJ Hooker head of research, Matthew Tiller.

Even with the headwinds of higher interest rates reducing borrowing capacity, Tiller forecasts home values to increase, however, it will be challenged by a rise in the number of properties on the market.

In 2023, national home prices across Australia rose by 5.52%.

According to Tiller, all eyes will be on the RBA governor during 2024 as mortgage holders across the country eagerly anticipate the commencement of the rate-cutting cycle.

LJ Hooker head of research Matthew Tiller
Matthew Tiller. Image: LJ Hooker

“While recent events, particularly comments from the US Federal Reserve, have seen the market now pencil in rate cuts earlier in 2024 than expected, the most likely outcome is for a long period of rates on hold, with rate cuts closer to the end of 2024,” said Tiller.

Tiller also pointed to recent inflation and employment data indicating that the RBA is close to finishing its rate hiking cycle.

The last RBA rate cut was on 20 March 2020, when the rate shifted from 0.50% to 0.25%.

The current cash rate sits at 4.35%.

“More homeowners will look to capitalise on the recent strong price growth and take the equity to upgrade their homes or downsize into retirement.”

Matthew Tiller, LJ Hooker

“Additionally, more mortgage holders who are struggling with repayments will also look to sell, now more confident that they can sell with some equity in place.”

Perth and Queensland’s 2024 hotspots

Tiller said the hotspot suburbs to look out for in 2024 are ones where values have steadied or fallen during the last year but will be attractive to buyers because of affordability.

PropTrack director of economic research, Cameron Kusher, previously told The Property Tribune that one of the factors that can make a suburb hot is its affordability relative to surrounding suburbs.

One such suburb is Quinns Rocks in WA, Your Property Your Wealth founder Daniel Walsh told The Property Tribune in December.

“Quinns Rocks will do quite decently because the stock is really low,” said Walsh.

“But you can still buy properties in the $500,000 to $600,000 range.”

Mandurah, located an hour south of Perth, is also tipped to perform well next year.

In the sunshine state, Tiller said buyers with their eyes on Brisbane will be fixing their gaze upon attractively priced suburbs such as Taringa, which has a median house price of $1.587 million, up 9.10% during the past year.

“Stabilising prices on parts of the Gold Coast, such as Elanora and Arundel, will add to their appeal.”

Weekly asking property prices for 4068, including Taringa

Sydney, Melbourne and Adelaide’s 2024 hotspots

Tiller said hotspot suburbs in Sydney include Dee Why, a coastal suburb in northern Sydney, and Glenmore Park.

Weekly asking property prices for 2099, including Dee Why

“Glenmore Park is offering good value for families with its median house price falling 2.4% to $1 million,” he said.

In Melbourne, Tiller pointed to the falling values in Croydon South, Carrum Downs and Bayswater North, which could lead to these areas growing in popularity.

Weekly asking property prices for 3136, including Croydon South

Looking at Adelaide, Tiller noted Payneham as a suburb to watch due to its steady growth.

Weekly asking property prices for 5070, including Payneham

“Median unit prices there have surged 9.4% to $396,000, making it an attractive investment,” said Tiller.

“Likewise, Plympton Park showcases solid buyer demand with low days on the market and its median price up 5.9% to $775,000.”

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