As a roaring spring begins, where are home prices headed?

Spring is here and so too is one of the busiest auction weekends of the year, with vendors feeling confident and buyers out in force – a trend economists expect to continue.

Research firm CoreLogic reports a whopping 2401 homes are set to go under the hammer across the country on Saturday, up 5.4 percent on last weekend and the third largest volume of 2023 thus far.

“Auction activity across Sydney is set to exceed 1000 for the second time this year, with 1010 homes currently scheduled to go under the hammer this week… up 16.5 percent,” CoreLogic economist Kaytlin Ezzy said.

Strong momentum in property markets continues to defy expectations.

About this time last year, most pundits were predicting steep price falls throughout 2023 on the back of soaring interest rates.

Instead, values rose for the sixth consecutive month in August, up 0.8 per cent nationally and now 4.9 per cent higher since bottoming out in February, data released today shows.

Sydney has led the recovery trend, with a rise of 8.8 per cent since prices found a floor at the start of 2023, while Brisbane has also seen values jump 6.2 percent in that time.

Cameron Kusher, director of economic research at data house PropTrack, said the “better-than-expected price growth” had reversed virtually all the declines seen in the backend of 2022.

“Property prices have increased despite rising interest rates and reduced borrowing capacities,” Mr Kusher said.

“From here, the direction of the housing market will likely be influenced by the volume of housing stock available for sale. Low volumes of new and existing properties persisted In June, but this may soon change.”

PropTrack’s newest Property Market Outlook report has forecast national home prices to be between 2 percent and 5 percent higher by the end of the year.

It is a marked turnaround on a previous prediction of a fall of between 7 percent and 10 percent, Mr Kusher said.

“Forecasts for 2024 are considerably more difficult, given the uncertainty of many factors. At this stage, we are forecasting modest price growth in 2024.

“However, significant changes to the overall economic performance, interest rates or lending conditions, could result in vastly different price growth outcomes.”

He predicts prices nationally could be up to 3 percent higher by the end of 2024, with modest growth across most capitals, including up to 2 percent in Sydney and up to 3 percent in Melbourne.

Domain’s recently released Forecast Report is a tad more optimistic, predicting the housing market will be in a “well-established, steady recovery” by mid-next year.

“House prices in Sydney, Adelaide and Hobart will record the largest gains,” the report predicts.

Forecasts are for house prices in Sydney to end the current financial year up to nine per cent higher, with modest growth in Melbourne of up to two per cent and a rise in Brisbane of up to 4 percent.

“House prices in Sydney, Adelaide, Perth and the combined capitals will be at a new record high [while] Brisbane house prices will be close to a new record high,” the report predicts.

Strong population growth is set to put “greater and more immediate pressure” on housing demand, which sees an additional 300,000 dwellings needed to meet needs.

“Typically, overseas migrants rent on arrival, but, with a tight rental market Australia-wide, we may see some arrivals transition to home ownership sooner as they seek more stable housing alternatives.

“This is occurring at a time the construction industry has experienced unprecedented headwinds – skills shortages, supply chain disruptions, and soaring construction costs.”

While prices are expected to rise, affordability pressures, high interest rates and restrictive serviceability buffers will contain the pace of growth, the report reads.

Mirvac has topped out Trielle at Melbourne’s Yarra’s Edge, with more than 70 per cent of the riverfront development sold and approximately 80 per cent of purchasers intending to make their apartment a home.

The figures, released on September 22, point to an owner-occupier audience for one of the precinct’s final residential towers. Mirvac began developing Yarra’s Edge in 2003, and its latest addition occupies one of the remaining absolute riverfront sites.

Mirvac CEO of Development Stuart Penklis said existing residents were among those moving up within the neighbourhood.

“Many purchasers already have a connection to Yarra’s Edge,” Mr Penklis said, describing buyers whose changing needs were encouraging an upgrade within the precinct.

“As one of the final residential towers within Yarra’s Edge, Trielle represents the culmination of more than two decades of creating one of Melbourne’s most established and sought-after waterfront communities,” Penklis said.

“Positioned on the Collins Street axis with absolute river frontage, Trielle offers residents a rare opportunity to enjoy sweeping views across the Yarra River, Melbourne skyline and Port Phillip Bay, while remaining seamlessly connected to the CBD. With Trielle now more than 70 per cent sold, we’re continuing to see strong demand from buyers seeking quality homes in established locations.”

The developer also flagged a penthouse and sub-penthouse collection with larger layouts, premium finishes and broad outlooks. The planned wellness centrepiece, The Oasis, encompasses a 900-square-metre elevated urban rainforest.

Mirvac General Manager Residential Development Victoria Elysa Anderson said Trielle had resonated strongly with buyers seeking a rare lifestyle offering in Melbourne.

“Opportunities to secure a new luxury residence on a riverfront site of this calibre are incredibly rare, particularly within a community like Yarra’s Edge,” Anderson said.

“What makes Trielle unique is the combination of exceptional views, world-class residential facilities and the lifestyle that already exists around it. Residents are buying into a mature waterfront community with parks, promenades, dining, wellness and strong community connections already in place.”

The 45-level tower brings a substantial new presence to that waterfront. Its residential offering spans one-, two-, three- and four-bedroom apartments, with Signature, Prestige and Sub-Penthouse collections accommodating different household sizes. The north-facing position connects the apartments visually to the river and city beyond.

Seven storeys above the promenade, the planned Oasis combines planting and a running stream with a Scandinavian-inspired wellness club developed with spa specialist Naomi Gregory. Facilities include a 25-metre lap pool, hot magnesium pool, sauna, hydrotherapy, a gym, yoga and Pilates room, and treatment spaces.

The amenity extends beyond exercise. Residents will have access to The Biblioteca library and workspaces, ground-floor work pods, and The Salone piano lounge. A private Chef’s Table dining room offers a setting for larger gatherings, while a cinema, games room and sports lounge broaden the entertaining options. Concierge services and a dog-wash area support everyday routines.

Trielle comprises a collection of one, two, three and four-bedroom residences. Reflecting strong demand from owner occupiers, approximately 80 per cent of purchasers to date intend to live in their homes, highlighting the project’s appeal to those seeking a long-term waterfront lifestyle.

Mirvac has recently delivered The Albertine, a premium apartment development on the edge of Melbourne’s CBD, and is nearing completion of Prince & Parade in Brunswick, further strengthening its portfolio of thoughtfully designed apartment communities in some of Melbourne’s most sought-after urban locations.

As a roaring spring begins, where are home prices headed?

It’s a busy weekend for Australian residential property as confidence returns amid steadying interest rates

Mirvac’s 45-level Trielle has topped out at Yarra’s Edge, pairing riverfront apartments with wellness facilities, private dining and resident services.