SQM Research said its base case for 2024 would see growth in Perth and Brisbane but the other capitals were likely to fall as interest rates bite.
But some of that increase would be because rents would continue to rise by as much as 10 per cent nationally as dwelling completions decline sharply. Global commodity prices would remain strong which benefits both Perth (iron ore, gold) and Brisbane (coal, gas).
Both cities had less exposure to the financial services market which SQM said would be in the doldrums next year and where there would be “significant job losses”.
“The rise in interest rates over 2022 and 2023, and possibly into 2024 will start to bite homeowners and would-be home buyers alike,” the report said.
“SQM Research expects a rise in distressed selling activity over next year and only the most cashed up willing to enter the market.
“Asking rents around the nation are expected to rise between 7 per cent to 10 per cent with the city of Perth tipped to record the largest increase of 12 to 15 per cent.
“While SQM expects an easing in the population growth to 460,000 people, it also expects a sharp decline in dwelling completions over 2024 to 153,000 dwellings.
“Current building approval numbers plus dwellings under current construction as published by the Australian Bureau of Statistics (ABS), strongly suggest the nation will have the lowest completion rate since 2012.
“This ongoing imbalance between demand and supply will continue to put upward pressure on rents around the country.”
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