27 Mar What Australia’s Housing Market Might Look Like in 2036
Australia’s housing market is constantly changing due to a range of factors; the state of the economy, demographic changes, family lifestyles and infrastructure development all impact the price of houses and the areas which are in the greatest demand.
At Power of Property, we specialise in helping both new and experienced investors to make smart property choices and purchase properties in markets that offer potential growth and wealth creation.
In this blog, we look at the key factors that look likely to have a significant influence on how the housing market for investors may develop over the next ten years.
More people renting long term
It is widely expected that by 2036, more people will have become long-term renters rather than property owners. This is particularly thought to be an option younger people choose for a number of reasons, such as the greater flexibility that renting provides. Work is no longer tied to a location as it once was, and so relocating for lifestyle reasons is likely to become more common.
The possible result will be a larger build-to-rent sector and longer leases, which are ideal conditions for investors, as there will be growing demand for well-managed rental properties in sought after locations.
Generational wealth transfer
There is a generational wealth transfer underway in Australia, as Baby Boomers pass on property and other assets to Gen X and Millennials, i.e., their children and grandchildren. It is predicted that large numbers of Gen X will take advantage of this to invest in property, and also give their own children a leg up into the market. For investors who are already building a portfolio, this ongoing influx of money will continue to ensure demand and strong prices.
A growing population fuelling the housing market
The Australian Bureau of Statistics predicts that the country’s population will grow to between 32.1 million and 33.6 million people by 2036. However, this is likely to be accompanied by an ongoing shortage in the supply of housing stock which will see both house prices and rental returns remain strong. This is especially likely in capital cities and popular regional centres.
No predicted drop in value of the overall housing market
While there is likely to be short-term dips in property prices over the next decade, due to interest rates and other economic conditions, industry figures confidently expect that real estate will remain in an upward trajectory. As the population grows and supply continues to fail to meet demand, there will be a growing need for housing across the country, and this produces an ideal set of circumstances for investors.
Popularity of compact living
The Australian family home has undoubtedly undergone a shift, and the desire for a big block in the suburbs has given way to medium-density housing. Duplexes, townhouses and apartments in inner-city areas are growing in popularity, as both home owners and renters choose indoor rather than outdoor space. Investment properties that can meet this demand look set to become even more popular over the next ten years.
Rise of inner-city neighbourhoods
Current trends in urban planning increasingly favour creating smaller, more compact inner-city neighbourhoods where facilities are within walking distance. These sorts of locations, where amenities are localised and fewer journeys are required to be made by car, will become even more popular over the next decade, and investors in these areas can expect to see ongoing capital growth and strong rental returns.
Desirability of eco-friendly homes
As energy costs continue to consume a vast proportion of household budgets, properties that are energy efficient are likely to become a priority for both home owners and renters. New builds that have features like solar energy, smart integration and battery storage are going to be increasingly sought after, and are the types of property that are likely to provide investors with strong returns.
Growth of regional cities
Regional cities across Australia continue to grow in popularity, with people opting to move out of increasingly crowded capital cities for a better lifestyle, more job opportunities, and better value for money when it comes to housing. For instance, the infrastructure and amenities in regional cities like Sunshine Coast and Gold Coast make them highly desirable locations for retirees, families and younger people alike, so investors in these areas are well-placed to capitalise on this growing popularity.
Take advantage of the changes in the housing market ahead of 2036
If you want to create wealth through property investing, it’s important to be aware of these and other potential developments in the housing market over the next decade.
At Power of Property, we specialise in providing opportunities for new and experienced investors to buy property in some of the most exciting developments in Australia’s capital cities and regional centres.
Our access to the latest research and data, as well as the market insights gained from long experience in the industry, means that we can provide access to a range of properties that support wealth creation and deliver long-term returns.
Call Power of Property on 0407 785 560 or use the online booking form to arrange a free, no obligation strategy session with Michael Lawton and Danielle Charlton in order to learn more about how you can best position yourself ahead of the oncoming changes in current Australian housing market.