This week we look at the Australian Property Investor Q3 Property Sentiment Report and the State Revenue Office Annual Review.
First off we’re looking at the API Q3-2024 Property Sentiment Report. Key findings of the report include:
1. Fewer people sitting on the property market fence:
This has not corresponded to a marked change in the proportion of buyers and sellers of residential property entering contracts in the past 12 months. Instead, it has seen a quadrupling in those buying a commercial property (from 3.1% – 12.5% in the past 3 quarters). The buying and selling of residential property is still dominant (34% of annual transactions), however commercial property is becoming a lot more significant with more than 1/5 of respondents active in this space.
2. Hitting an investment ceiling:
This quarter, the gap between those transacting on 1 and 2 investment properties has been steadily closing. A year ago, the gap stood at 18%, now it is 11%.
3. Renting on the rise, building in decline:
The proportion of respondents saying they planned to build in the coming year fell from more than 10% at the end of 2023 to 6.8% in this quarter. The intention to rent has hit a peak now sitting at just below 12%.
4. Investors are active and targeting traditional housing assets:
The past quarter has seen a marked shift toward the traditional investment vehicles of houses, units, and apartments (apartments are high as affordability bites).
5. Victoria now seen as undervalued:
Dramatic upturn in respondents identifying Victoria as having the best investment prospects for the coming 12 months.
6. Rental yield expectations moderating:
4 in 5 respondents were landlords. Investment property owners now regard a lower bracket as their idea of satisfactory rental yield. With rental market vacancy rates rising, landlords are less likely to lose a good tenants.
7. Property market still has plenty of steam:
Overall positive responses regarding the current property market, just over 60% of respondents expecting regional property prices to increase and 81% believe Australian property prices will increase.
8. Which are the big 4 factors influencing property decisions?
• Housing supply – 19%
• Interest rates – 16%
• Population growth – 14%
• Building costs – 11%
9. Heightened interest rate sensitivity:
Both buyers and sellers said interest rates are affecting their decision to sell in the next 12 months. The uncertainty is what has changed the usual correlation that ‘yes’ interest rates are affecting their intentions.
10. Inflated concerns about cost-of-living pressures:
In 6 months, the proportion of respondents saying inflation has affected their ability to enter the property market has climbed from 61% to 71%
11. Foreign buyers no longer seen as the enemy:
Established properties attract an application fee of $44,100 for a property under $1 million, rising to $88,500 if value is between $1-$2 million for foreign buyers.
There are flow on effects to this – foreign-owned properties are more
likely to add to the rental pool. Less than a year ago (Q4 2023) 73% of respondents said there should be no financial incentives or tax concessions for foreign buyers. Yet, amidst the rental crisis, this number has dropped in Q3 2024 to 56%.
12. Stress levels moderating.
The end of 2023 saw respondents feeling less under mortgage or rental stress. There was a spike again in Q1 2024, however it has started to lower again.
13. Investors are back
Buying an investment property has almost exclusively dominated the list of real-estate related investment – again in this Q3 update with 27% (rental yields). Second and third highest priorities were to reduce loan debts (20%) and position for retirement (16%).
14. Deposits out of reach as cost of living bites hard:
The household savings rate has plunged to 0.6%. This means households on the whole spent 99.4% of their disposable income. To put this into perspective, in Q2 2020, savings was 24.1%.



state revenue oppice report 2023-24
The SRO Review is now available:
- Assessed $31.4 billion in revenue
- $853.7 million in first home buyer concessions (equates to ~10% of
total stamp duty revenue) - Responded to 337,164 phone calls, 70479 emails with an 81%
customer service satisfaction rating - Provided expert advice on tax technical matters to customers through
the delivery of 1,389 private rulings