Capital cities outshine regions in 2024 Rising Stars Report for property investment potential

The annual Rising Stars Report, which examines a series of forward-looking indicators to provide insight into the markets primed for property price growth, has identified capital cities as outshining regional areas in terms of investment potential for 2024.

The report, produced by Canstar and property expert Terry Ryder, forecasts the future of Australia’s 14 key property markets — eight capital cities and six regional areas.

Canstar’s ambassador and money expert, Effie Zahos, said affordability and lifestyle benefits were the biggest drawcards for regional living in recent years, but property prices have surged in popular regional areas as more Aussies have made the exodus from capital cities.

“The allure of urban living is piquing our interest again as many companies mandate the return-to-office with a range of perks such as flexible work options, office catering, subsidised transport or parking incentives, social events, in-personal professional development opportunities,” Zahos said.

“Add to this the thriving economies, ongoing infrastructure spending and big-name events hitting our key cities and it’s easy to see why our capital cities are shining – the lights are back on for sure.”

The report pinpoints 110 ‘Rising Star’ suburbs and towns across the nation that have impressive sales volumes, solid price growth, low vacancy rates and high rental growth, plus infrastructure spending and planned amenities.

A key consideration in the research is affordability, with 54 percent of Rising Star suburbs having a median unit or house price below $600,000, and 37 percent of this year’s list consisting of units, up from 18 percent last year.

Zahos explained that rising interest rates and living costs are impacting affordability and the borrowing power of buyers, as well as their ability to meet loan repayments.

“Whether you’re purchasing a house or a unit, managing debt is an ongoing task. Even if rates drop by the year’s end, don’t expect them to dip as low as one or two percent. The era of cheap funding is behind us,” she said.

The report shows a shake-up in the rankings of Australian real estate markets compared to previous years, with larger capital cities moving up in the rankings.

Brisbane topped the leaderboard this year, followed by Adelaide and Sydney.

Regional Queensland tied in fifth place, and Regional West Australia came in seventh place, but the outlook for regional centres is generally more subdued.

Hotspotting property expert and co-producer of the report, Terry Ryder, said Brisbane cemented its position as a property hotspot powerhouse, while Adelaide continued the trend of smaller capital cities holding their own.

“Sydney surged this year, rising nine places in the rankings to round out the top three. The biggest improvement in Sydney has been a steady rise in sales activity, with buyer demand growing in the past 12 months. The harbour city has also become a national leader in rental growth,” Ryder said.

The report aims to help unlock opportunities for those considering a tree change, an urban return or buying in their own backyard in 2024.

The full list of the 110 ‘Rising Star’ suburbs and towns can be found at Canstar.com.au/rising-stars-report.