Pressures such as the cost of living, stubborn interest rates and waitlists have tested the housing market this year, however in Yarrawonga Mulwala the market remains strong.
Data from the CoreLogic Home Value Index report show that some regional markets such as Yarrawonga Mulwala are once again outperforming the capitals.
Markets have seen the quarterly growth trend ease since April with the region's weaker performance through the recent recovery period helping re-capture some affordability advantage, helping to skew growth towards the combined regions.
Director of Mark Seeliger Family Real Estate Mark Seeliger said locally the demand is really strong at the moment with his business having unprecedented sales and smashing a few of their own records sales wise.
“We have had a really strong finish to the year in terms of sales,” Mr Seeliger said.
“In that sense I feel like we carried a lot of stock through winter that didn’t sell but then we listed really strongly in spring which means we are carrying a lot of stock but the sales have been strong right across the board.
“The market still feels like it is travelling ok.
“The last three to four months have been really strong.
“Post covid I think the market is still really good here, we’re not setting the world on fire but we have a steady stream of sales.”
“The supply is definitely outstripping the demand at the moment.
“I feel like the market has been pretty good.”
According to RPData through CoreLogic, the Yarrawonga median price to purchase a house is $665,000 down by 6.1% in the past 12 months.
Over the river in Mulwala, the median price to buy a house is $557,000, up by 2.7%.
According to realestate.com, median prices for units in Yarrawonga are seeing a downward trend, down 10.5% to $425,000 whilst in Mulwala, realestate.com figures show units in Mulwala are falling even less than their Victorian counterparts with a decrease of 18.1% for a median price of $393,000.
In terms of renting, Mr Seeliger said the rental market is incredibly solid with properties not hanging around for very long at all.
“Anything near the lower end goes pretty much straight away and the higher end, there is a bit online at the moment but they tend to be going within a couple of weeks so it is really good,” Mr Seeliger said.
“The rental market is just really strong.”
When asked what he thinks we can expect come the beginning of 2025, Mr Seeliger said the federal election has a large role to play.
“Typically what we see in the lead up to an election is a slowdown in the market,” Mr Seeliger said.
“Depending on the result and if we get an interest rate decrease, I think the market will run.
“I think more confidence will come back in and investors will come back to the market.
“Major investors are in the market already.
“I’m bullish on next year. Once we get a bit of stability with the election being done and dusted and hopefully a drop in interest rates, I think the market will be very strong again.”
According CoreLogic Research Director, Tim Lawless, financial markets are pricing in a rate cut around the middle of next year, while economists from the big four banks are expecting rates to drop sometime between February and May.
“Until interest rates come down, it’s hard to see the weakening housing trend turning around,” Mr Lawless said.
“A lower cash rate will be a positive factor for housing markets.
“Lower mortgage rates will provide a lift to borrowing capacity, and, along with lower inflation, should see an improvement in serviceability assessments and see a further rise in consumer sentiment.
“A couple of rate cuts might be enough to shore up a declining trend in home values, but it is hard to see any material upward pressure returning until interest rates reduce more substantially and affordability barriers are less formidable.
“Most of the regional markets continue to provide some support for growth in the national index, but it is clear momentum is also leaving these markets.”
Mr Lawless added that at 5.3% annual growth, rents are still rising at more than twice the pre-pandemic decade average of 2.0% but given the weak monthly change the annual trend is set to slow further from here.
“It will be interesting to see if the rate of rental growth rebounds through the seasonally strong first quarter of the year in 2025, but beyond any seasonality, it looks increasingly like the rental boom is over,” Mr Lawless said.
Rental appreciation is slowing across most markets due to a combination of lower population growth, especially with less net overseas migration, but also a gradual recovery in the average household size which is helping to moderate rental demand.
“A trend towards smaller households during the pandemic was a key factor boosting housing demand, particularly demand for rental housing, as group households split up and Australians gained a preference for more space,” Mr Lawless said.
“A record low in rental affordability is probably a central reason for the rebound in household size, with high rents likely to be forcing a restructuring of households as renters look for ways to minimise their housing costs.
“The residential construction sector continues to face feasibility hurdles in getting new housing stock to market, with materials and labour costs having surged over the past five years.
“Construction costs aren’t rising as rapidly as they were through the pandemic, but they are still increasing at around 1% a quarter.
“Significant competition from major public sector infrastructure projects is likely to keep prices for labour and materials high across the residential construction sector.”
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