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Home Values Keep Rising

Unit Prices To Boom

Housing supply constraints are tipped to result in an increase in demand for units, with prices expected to boom as a result. Rising migration, increasing property prices and a shortage of land supply, means units are becoming a viable option for many. Units are beginning to make up a larger portion of Australia’s housing stock with CoreLogic figures showing they make up 25.9% of the national housing stock, up from 19.6% in 2010. Units account for 30.4% of capital city housing stock in comparison to 22.9% in 2010. CoreLogic economist, Kaytlin Ezzy, says there is strong demand in the unit rental market with many migrants choosing to rent before buying. “The impact of this additional demand has already been seen in the rental market,” she says. “While worsening rental affordability has seen the pace of unit rental growth ease in recent months, unit rents are likely to remain elevated for some time, especially with net overseas migration expected to remain high through 2023 and 2024.” The result of continuing demand for units will be growing prices. “With the cash rate potentially easing in 2024, greater purchasing demand could fuel a stronger price boom in the unit market at this time,” Ezzy says.

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