17th January 2022 / Jeremy Desmier: Market Update | January 2022

The property market finished on a high in 2021, with a record number of properties sold across the country. The Domain Group reports that it was the fastest annual rate of house price growth on record, at 21.9 per cent.

We saw a change in attitude of prospective buyers, as the importance of space increased and a desire for lifestyle additions and location became a priority. This translated in buyers paying a premium for space, and an increase in internal migration to regional areas of Australia.

Victoria's residential median property prices broke new records, with four consecutive quarters showing highest-ever results, according to the Real Estate Institute of Victoria's September quarter report. Melbourne maintained its $1 million dollar median, and now has 173 suburbs in the million-dollar club.

The big banks have predicated more moderate price rises for Melbourne homes in 2022, ranging from 5-8 per cent. Real Estate Institute of Victoria (REIV) president, Adam Docking, said that the federal election and any interest rate rises could trigger caution among market participants, but that the former would be temporary, and he didn't expect the latter to occur until "deep into the year" or 2023.

We expect to see a more balanced market this year, with the number of new listings remaining strong and plenty of buyers still searching for their dream home. Buyers will benefit from greater choice, as well as the predication by economists that interest rates will remain on hold until late in the year or in 2023.

In the property management space, the Domain Group reports that house rents in Melbourne have hit record highs. Their December 2021 Rental Report shows that house rents jumped by 3.5 per cent, or $15 per week, over the December quarter to a median of $445. Unit rents also rose, by a more modest 1.4 per cent over the quarter, or $5 per week to a $375 per week median. The data showed that the strongest performing regions were on the Mornington Peninsula, in the inner South, the Outer East and the North West.

Please don't hesitate to get in touch to discuss your property situation. We look forward to being of assistance to you throughout the year!