A look back at 2023, and what’s to come in 2024

A look back at 2023, and what’s to come in 2024

author: Tim Hull

published date: December 20, 2023

in this article...

In our last Insight for the year we take a look back at some of the key events that shaped 2023 and ponder what 2024 may bring for property investors.

Hard to believe we’re about to draw 2023 to a close and welcome in 2024. For many, this year has felt like a 12 round boxing match, with the RBA lifting the cash rate in February, March, May, June and November, leaving those with mortgages reeling from rising repayments. Along with a rental crisis for those without mortgages, it’s easy to appreciate why many are ready for some downtime and a holiday.

Surprising growth

Despite the increased cost of living expenses, and during a time when the attack on inflation was largely expected to take the heat out of the property markets, many capital cities saw the opposite and posted strong gains in 2023 price growth, with many areas seeing record prices obtained throughout the year.

Perth posted a staggering 13.6% increase in house price values, while Brisbane came in second amongst the capital cities with a very respectable 10.3%. Sydney ran a close third with 10.2% with Melbourne a comparably diminutive 3%. A full breakdown can be found in CoreLogic’s Best of the Best Report released earlier this month. CoreLogic’s head of Australian research, Eliza Owen had this to say:

It’s pretty extraordinary to see values get to a new record high despite further uplifts in the rate-hiking cycle. At the start of the year, the market was a lot more exuberant. There was a lot more hope the cash rate would peak at a relatively low level and buyers were really taking advantage of the dip.

A lot of wealthy buyers saw it as a great buying window. But as we got towards the end of the year, it’s clear the more affordable end of the market emerged as the more resilient and popular amid interest-rate constraints that are much higher than what we thought they would be.

An RBA shake up

After being derided in the media for mixed messaging over recent years, former RBA head Philip Lowe exited stage left in September, making way for the first female Governor Michele Bullock.

Photo source: abc.net.au

This came only months after Treasurer Jim Chalmers released his investigative report into the RBA – the first external review since the early 80’s. Some of the key recommendations contained within the report include:

  • The establishment of a ‘monetary policy board’ with improved economic expertise;
  • The separation of the two boards – one for governance of the RBA and one for monetary policy;
  • A shift from eleven meetings a year to eight, allowing for greater intervals to consider issues and assess impacts;
  • The existing inflation target of two to three per cent should be retained; and
  • Increased transparency through the addition of a post RBA meeting press conference where board members would be encouraged to speak publicly.

It will be interesting to watch if and how these recommendations are implemented in the coming 12 months.

What does this mean for 2024?

Great question. Much will ride on whether the inflation beast can be tamed. If so, we envisage lenders resorting to more lenient lending policies as rates start to decline. It should be noted that all four big banks are on record predicting interest rates to turn the corner in 2024.

We believe that property prices will continue to climb, with some areas benefiting more than others. At a time when construction supply chains are still impeded, construction companies are struggling, and net national and international migration is high, there appears to be little on the radar that would force prices down. While this will benefit investors and home owners, we see continued difficulties for first home buyers.

Here at PPA, we’ll hit the ground running in early January, with many constructions still underway and more projects soon to be launched. And while our NDIS offerings continue to be popular with our clients and new investors, we are working hard to expand our traditional property investment footprint.

Additionally, we are bringing new offerings to market, including a co-living investment property strategy, specifically targeting multi generational, multi tenanted properties under one roof, and another very exciting opportunity currently in the works. While we can’t say much at the moment, we look forward to announcing something publicly in Q1 2024.

In closing…

We would like to take this opportunity to thank all of our clients for their continued custom over 2023, and for giving us the opportunity to play in a space that we’re passionate about. We wish you all a very Merry Christmas, a happy holiday and hope you enjoy the down time.

And to those clients we haven’t met yet, we look forward to meeting you in 2024.

Bye for now.

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tim hull

director & property investment strategist

For more than a decade we have helped hundreds of people purchase residential investment properties across many areas of Australia.

We have a wide range of property types for you to consider to align with your current and future plans specialising in traditional, NDIS, SMSF, multi-lease, dual occupancy and duplex builds.

We are here to assist in sharing our experiences gained in our role as property investment strategists, builders, property developers and investors.

I’m sharing my experiences gained in my role as a property investment strategist, educator, and advisor via educational videos, courses and articles covering property investment and business related topics.

For more than a decade I’ve helped hundreds of people purchase investment properties in all parts of Australia. I’ve owned and operated several businesses, and I’m also an active property investor myself.

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