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[Podcast] 5 big property trends to watch for in 2023, with Dr. Nicola Powell

[Podcast] 5 big property trends to watch for in 2023, with Dr. Nicola Powell
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As I look back at 2022, the year seems to have gone quickly for me, even though I know for a lot of people, it has been a slow and difficult year. My Podcast #432 5 Property Market Trends With Dr.nicola Powell 06

For those in property, it was a roller coaster year where we came to expect the unexpected.

We went from this time last year, the RBA declaring that “The Board is committed to keeping the cash rate at this level until 2024,” to ending up with 8 consecutive hikes this year.

That meant we moved from boom conditions at the beginning of this year, driven by ultra-low borrowing costs and strong demand to falling property markets around Australia, with fragmented markets as each state performed differently.

So, what’s ahead for us?

What will 2023 bring?

That’s the question I want to discuss with my guest today, Dr Nicola Powell, chief of research and economics at Domain.

2023 Property Trends

It’s likely 2022 will be remembered as the year that our housing markets transitioned from a once-in-a-generation property boom into a downturn. Property Investment

And no one will forget that it was the historic succession of interest rate rises that lowered buyers borrowing capacity by up to 25% and forced many aspiring home buyers out of the market for the time being.

The rental markets were also in crisis this year, with a perfect storm of rising interest rates and record-low vacancy rates causing rental prices to be hiked nationwide.

Now, the question on many people’s minds is, “what will the property market look like in 2023? Will it stabilize or be just as tumultuous as 2022?

What were the highlights of 2022?

  • We moved from a property boom to a property downturn
  • The power shifted from sellers to buyers
  • Affordability became a concern for many buyers due to consecutive rate hikes and rising inflation.
  • Consumer confidence slumped. Consumer
  • House prices across the combined capitals have fallen 4.9% from the March 2022 price peak, down about $53,000.
  • The rental market became extraordinarily tight, with tourism and overseas migration trickling back, placing greater pressure on supply as demand increases.
  • So just how much have markets across Australia gained since 2020?
    • Combined capitals
      • Upswing: 33.6 per cent
      • Downturn: -4.9 per cent
      • Total overall gains compared to the pandemic trough: 27 per cent
    • Combined regionals
      • Upswing: 32 per cent
      • Downturn: -1.3 per cent
      • Total overall gains compared to the pandemic trough: 30.3 per cent

What’s ahead for 2023?

  • Headwinds
    • Further rate rises
    • Borrowers with fixed-rate mortgages moving to more expensive variable rates Immigration3
  • Tailwinds
    • Lack of supply
    • Surge in immigration
    • Relatively strong economy
    • Low unemployment
    • Sentiment will change when inflation and rate rise peak

2023 Property market trends to watch

  1. Downturns will be shorter and less severe
  2. Multi-speed property markets will create opportunities for upgraders
  3. Interest rates aren’t the only factor affecting housing prices Property Market
  4. The return of international immigration will increase the housing demand
  5. Buyers will be willing to pay for the right neighbourhood

Links and Resources

Michael Yardney

Get the team at Metropole to help build your personal Strategic Property Plan Click here and have a chat with us

Dr. Nicola Powell – Domain's Chief of Research and Economics,

Join us at Wealth Retreat 2023click here to find out more

Get a bundle of free eBooks and reports at www.PodcastBonus.com.au

Some of our favorite quotes from the show:

“Affordability was the issue even before interest rates started rising in May.” – Michael Yardney

“We know there’s a huge undersupply of properties.” – Michael Yardney
“We all have our difficulties, and some days we feel like making excuses, but winners stop themselves. They don’t make excuses, they just get the job done.” – Michael Yardney

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About

Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media.


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