Debbie Shankar - 25 Nov, 2016

The Outlook for Australian Real Estate

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Some areas of Australian real estate have reached a peak. However, there are others that are still performing well. Therefore, the key to sound investment in today’s mixed market is research. Identifying sound markets before buying means you will purchase an investment that will grow in value. Plus, you will have a high occupancy rate. It is also a good idea to avoid buying high-risk property.

High-Risk Purchases

Many real estate experts and authorities such as the Reserve Bank of Australia (RBA) are warning investors about buying off-the-plan apartments. There are now too many high-rise developments in inner-city locations, and more planned for construction. Therefore, supply will outstrip demand. Hence, it is likely that purchases prices will be more than the actual value of the property when completed.

Thankfully there are many more options when it comes to buying real estate. Experts are suggesting that investors look at houses and smaller unit developments when purchasing.

Expert Predictions for the Capitals

Real estate experts recommend that investors avoid inner city apartments and off-the-plan developments in all capital cities. Instead, investors should focus on the following:


What to watch.  The outer and mid suburbs of Adelaide have a steady growth of around 2.5%. Investor sentiment is high is Hewett, Brahma Lodge, Salisbury Downs and Paralowie. New developments that represent value for money and are situated close to are also ideal.

Future predictions.  Economically speaking, this capital will experience some turmoil over the next 12-months due to the Holden factory closing. Plus, several public construction projects are winding-up. As a
result, property growth in this area will stagnate. Although, no substantial declines will occur.


What to watch.  Investment is strong in inner Brisbane with around 7% growth. Suburbs to focus on include Bowen Hills, Fortitude Valley, Highgate Hill, Kelvin Grove, and Spring Hill. When buying, concentrate on suburbs that have infrastructure planned.

Future predictions.  Buy houses, rather than units as growth will continue to be strongest in this sector. Employment figures may dampen investment in this region.


What to watch.  The strongest areas are those with mid-range growth. Look for property in high demand locations to reduce vacancy rates.

Future predictions.  Home values will grow by around 8% over the next 3-years. Units, on the other hand, will fall by 3.7%.


What to watch.  Inner and northern suburbs have experienced marginal declines, compared to other suburbs. Areas to observe include Malak, Miller and Karama as these have potential to bounce back from mining industry changes.

Future predictions.  Economically speaking, this city is struggling after mining closures. Growth in this region will be marginal as the area recovers from economic changes.


What to watch.  Median home prices in outer Melbourne suburbs are stable at 10% growth. Focus on Greenvale, Sunshine and Hoppers Crossing when buying.

Future predictions.  Property values in this city will plateau. Drops in dwelling values will be around 1%.


What to watch.  Waiting to buy in this city is best. Declines in value will continue for some time. Suburbs that are performing better than others are Koongamia, Gosnells, Stratton, Maddington and Lockridge.

Future predictions.  Dwelling values will drop by 2.5%, and unit prices by 5.5%. Reduced mining investment and harsher economic conditions in Western Australia are continuing to affect the property market.


What to watch.  Strong growth has occurred in outer Sydney suburbs and hills districts. Western Sydney has also had strong growth of around 3.5%. Investment in Parramatta, Strathfield and Ashfield should see strong results.

Future predictions.  Apartment growth will decline. Nevertheless, homes will increase in value over the next 3-years.

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