4 Property Trends to Expect in 2018


Carolin Petterson, World Executives Digest |  Over the past 5 years, property prices have been soaring, especially in Sidney and Melbourne where they went up 75% and 59% respectively, leaving homeowners, prospective buyers, and renters to wonder what 2018 has in store for them. Some new policies were introduced in order to safeguard property prices and debt levels, which led to a slowdown in the housing market in 2017. Some key indicators, such as the auction clearance rate and lending to investors are already showing signs of decline, meaning that it’s safe to say that we’re looking at price growth stabilization. Here’s what we can expect in 2018 when it comes to real estate.

The rapid population growth will continue

This trend will continue as some estimates say that each year the population of Australia increases by approximately 400,000 people, which means that demand for housing will stay strong. At the moment, it sits in the vicinity of 164,000 dwellings annually. Due to a strong population growth as well as some other factors such as the rise of one and two-person households, the projected demand growth by 2021 is 5%. In other words, each year there will be 172,000 new households. Naturally, more and more people are gravitating towards the big cities, so Melbourne and Sydney are, and will in future be, experiencing a high growth rate. With the demand going up and the Harbour City being one of the hottest locations, it’s a good idea to get in touch with White Square Properties, an agency specializing in the Sydney area, for any real estate transactions.

Fewer upgrades, more renovations

Pricey stamp duty taxes on property transfers are responsible for the fact that people who are interested in upgrading will be more likely to pass on this opportunity and stick to what they already have. If we bear in mind that the average stamp duty is somewhere around 4% of purchase price, upgraders who opt for a median-priced house in Sydney or Melbourne should be ready to pay approximately $50,000 on the account of this tax. In combination with lower interest rates, many people choose to renovate, thus adding value to their property. This trend will continue well into the 2020s as a relevant research study has reported that 32% of homeowners are considering renovating in the next five years.

Better times for renters are coming

In 2018, it’s expected that both state and federal governments pay more attention to some of the problems renters are facing and improve things for them. For example, the Government of Victoria passed the Bill in 2017, which would finally allow tenants to sign leases protected by the tenancy legislation for periods longer than 5 years. Also, the same Bill put an end to rental bidding, limited rent increases to once a year, and allowed pets. In addition to that, renters can now make minor modifications, and they still need to ask for their landlord’s written consent, but on the bright side, landlords will have to greenlight minor modifications such as anchoring furniture, installing picture hooks, or the internet connection. All these measures will help people feel safer, more protected, and at home.

Property investors will pull the plug

As the property market will be stabilizing, investors won’t be able to expect double-digit percentage price gains, which will make them think twice before buying. However, this applies only to those who are interested only in a short-term profit as they will be put off by the fact that their investment won’t pay off as quickly as they want. On the other hand, forward-thinking investors might see this as an opportunity to obtain a property whose value will gradually grow over the course of years, without having to wrestle with other buyers.

To put it in a nutshell, 2018 will bring some significant changes and slowdowns to the Australian property market, but despite some predictions, the housing bubble won’t burst anytime soon.

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