Property Insights | Solid growth in settlement volumes in line with economic recovery

This report provides a comprehensive view of property settlement trends in Australia. In this report ‘national’ is defined as the 5 mainland states: NSW, VIC, QLD, WA & SA. Our analysis excludes TAS, ACT & NT which when combined make up less than 5% of total property settlements in Australia. Settlement data in this report includes all digital and paper-based settlements for residential and commercial property, unless otherwise stated. Data in this report has not been adjusted for seasonality. Non-monetary property settlements such as family transfers or gifts have been excluded. 

Key Findings: Sep-24 Qtr

• In the Sep-24 Qtr, there were 183,288 property settlements nationwide, corresponding to a total value of $178.3 billion spent on property in the quarter.
• Across the mainland states, QLD again recorded the highest number of residential settlements, but all states posted a strong result in Sep-24 compared to the year prior.
• Both residential and commercial property settlement volumes improved considerably compared to the same period in the previous year. 
• Differences in the performance of median residential property sale prices across states saw Brisbane extend its lead over Melbourne as the second most expensive capital city during the Sep 24 Qtr, having overtaken Melbourne during the previous quarter. 

Seasonal drivers: Sep-24 Qtr 

• All three months in the Sep-24 Qtr were an improvement upon the same months in the prior year, indicating a more stable and recovering property market in the second half of 2024, compared to the previous half.
• Historically, the September quarter tends to perform at a lower level than other quarters, since it follows the end of the financial year, where there is typically a surge in settlements. This seasonal pattern is more pronounced in every state other than QLD, which tends to have a smoother quarter-to-quarter settlement pattern. 

Macroeconomic drivers: tax cuts and receding inflation are supporting the property market in Sep-24 Qtr

• The Australian economy grew very modestly in the first half of 2024, with real GDP rising by just 0.2% in the June-24 Qtr, and by 1.5% over FY24. However, GDP per capita had fallen for a sixth consecutive quarter, and was down by 1.0% y/y. Growth is estimated to have picked up pace in the Sep-24 Qtr, with household incomes, consumption and housing investment supported by income tax cuts from 1 July 2024, together with the benefits of receding inflation and a resilient labour market. 
• Inflation has continued to slow to 2.7% y/y in the 12 months to August 2024. Rental prices and new dwelling prices continued to contribute to inflation however, with prices rising by 6.8% and 5.8% respectively. High labour and material costs added to the rising price of new builds, which is continuing to constrain new housing supply growth.  
• Growth in new housing supply – including houses and apartments – has continued to lag behind growth in demand for new housing nationally in most locations. New homes are taking longer, and costing more, to build than in the past. These capacity constraints are pushing more buyers into the market for existing homes and pushing home prices higher. 
• Strong population growth and low household sizes (average people per dwelling) continued to support strong underlying demand for housing, although this has eased in recent months. The Reserve Bank of Australia (RBA) believes that population growth is past its peak and that average household size has increased in recent months. 

QLD continues to record the highest residential settlement volumes in the nation

Analysis by .id (informed decisions) showed that NSW lost 31,183 in the year to March 2024, most of which moved to QLD (who gained 30,930 people over the same period). QLD’s composition of population growth strongly favours homebuyers. Although NSW and VIC receive the bulk of overseas migrants, these migrants are predominantly international students and temporary migrant arrivals, who are much more likely to rent, rather than buy dwellings. 

Sale prices in Victoria have been notably flat over the past two years, in contrast to ongoing price growth in the other eastern states. This has seen Brisbane overtake Melbourne as the second most expensive city, behind Sydney. 

• Consistent with movements in Westpac-MI’s “time to buy a dwelling” index, buyers’ perceptions of affordability varied across each state. For Queensland, the “time to buy a dwelling index” fell by 17.9% in August 2024. 
• In QLD, settlement volumes for residential properties priced under $750,000 have declined every quarter since the Mar-22 Qtr. Even as the property market has improved, properties under $750,000 haven’t seen positive volume growth, suggesting that increasing prices has moved a substantial number of properties out of the $750,000 bracket. 

• Both capital cities and regions saw solid near-double digit growth compared to the Sep-23 Qtr, apart from regional Victoria.
• Regional WA is a particular standout – residential volumes had surged by 19.5 per cent in the Sep-24 Qtr compared to the prior year.  

• The QLD postcodes featured on this list are predominantly located on the coast, with pockets of new housing development. In particular, postcodes 4670 (Bargara), 4207 (Yarrabilba), 4655 (Urangan) and 4306 (Ripley) sold more than 200 vacant lots each in the Sep-24 Qtr. 
• In VIC and SA, the only inner-city postcodes to appear on their respective top 10 lists were postcodes 3000 (Melbourne) and 5000 (Adelaide). 

Homebuyers spent a total of $159.4 billion across the five mainland states

• In line with flat median prices in VIC, the share of aggregate value in VIC has declined, and QLD has taken an increasing share. 

A total of 8,002 settlements for commercial properties were settled in the Sep-24 Qtr

• Commercial sale settlements were strongest in QLD (2,836), followed by VIC (2,797). 

• The market for commercial property, which had been rather sluggish in early 2024, has bounced back this quarter, in line with the market recovery for residential properties.
• The largest improvements were seen in NSW (+10.3% y/y) and VIC (10.7% y/y). 

$78.4 billion was spent on commercial property in the eastern states in FY24

• The aggregate value of commercial sale settlements increased year-on-year in QLD and VIC, which were 12.0 per cent and 16.4 per cent higher than over the same period in the previous year.
• Although commercial sale settlements in NSW grew by 10.3 per cent compared to the Sep-23 Qtr, this is not reflected in the aggregate spent on commercial property, which declined by 1.0 per cent. This probably reflects the composition and proportion of commercial properties sold, with a larger number of smaller or lower-value commercial properties sold in the quarter, compared to VIC and QLD. 

For further enquiries about this report or other property and mortgage insights, please contact us at research@pexa.com.au. 

For media enquiries, please contact:  

Kate Prigg – Corporate Affairs Manager, PEXA  
E: kate.prigg@pexa.com.au  
M: 0497 595 580  

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South Australia 

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