PEXA report shows metropolitan property markets outperforming regional areas

PEXA’s latest Property Insights report reveals a significant shift in Australian residential property transaction trends, with metropolitan areas outpacing regional markets in FY24.

Key findings from the report include:

Total residential property settlements across Australia’s mainland states reached 663,158 in FY24, a 5.5% increase from FY23.
Residential property market spending surged to $585.6 billion, up 12.6% year-on-year.
Queensland led with 180,462 residential property transactions, followed by NSW (177,656) and Victoria (172,902).
NSW recorded the highest value of sales at $215.5 billion, followed by Victoria ($142.0 billion) and Queensland ($137.6 billion).
Greater Sydney and Greater Melbourne saw substantial growth in property transactions, with increases of 16.1% and 8.6% respectively.
Regional markets experienced more modest gains or declines, with regional NSW growing by 1.1% and regional Victoria declining by 5.9%.

Julie Toth, PEXA Group’s Chief Economist, said: “Our biggest Metropolitan areas – Greater Sydney and Greater Melbourne – saw substantial growth in property transactions in FY24, with increases of 16.1% and 8.6% respectively. At the same time, regional markets in the same states experienced more modest gains or even declines in sales numbers, indicating a shift in buyer preferences back towards urban living.”

Toth highlighted that expanding outer suburbs are becoming ‘hotspots’ of sales activity as buyers seek more affordable properties within commuting distance of employment, education, and community needs.

The suburb of Tarneit in Victoria recorded the highest number of settlements nationally at 5,906 sales in FY24.

However, Toth noted that Australia continues to face housing availability and affordability challenges due to constraints on new supply, including high interest rates, elevated construction costs, and prolonged construction timelines.

The commercial property sector experienced a 3.2% decline in settlement numbers in FY24, reflecting market complexities and subdued investor sentiment.