AGP Executive Report

Buyer Hesitation: Three in four first-home buyers are waiting for prices to fall further, while rising rates and tighter borrowing are slowing sales and leaving some buyers walking away from deals. Price Divide: Sydney values have fallen for seven months, down 5.5% from their November peak, though a handful of suburbs—especially unit markets—are bucking the trend. Regional prices are holding up better, and Perth’s price bottom may be closer than buyers expect. Commercial Property: Higher rates are cooling demand, even as deal numbers rose 21%. Housing Supply: Calls to fix the supply shortage “the hard way” reject rent caps, while advocates say downsizing could free up homes as older Australians hold millions of spare bedrooms.**

Buyer Hesitation: Rate fears are freezing property plans: a survey found 41% of Australians think it’s a bad time to buy a first home and 47% a bad time to sell. Mortgage stress has reportedly reached 450,000 households, with another rate rise flagged for November. Market Pressure: Home values have fallen in 82% of suburbs, and some Sydney areas are down as much as $353,500. Vendors are relisting after buyers walk away from late-stage deals. Housing Policy: Labor and the Coalition reject rent caps as debate intensifies over the housing crisis. Advocates say supply needs to be fixed by building more homes, while downsizing could free up spare bedrooms. Building and Commercial Property: Dwelling commencements rose 7% in the June quarter, but construction businesses face mounting cash-flow strain. Commercial property searches are down year-on-year; industrial sales have grown, while office vacancies and rising rates weigh on investor appetite.

Price Outlook: Property experts expect home values to fall 8–11% from their March peak, with a recovery unlikely before September 2027. Prices have already dropped 5.2%, while national rents remain near $700 a week. Mortgage Pressure: About 450,000 households are spending more than they earn, with stress rising sharply over the past year and analysts warning of growing default risks. Rental Policy: Labor and the Coalition have both ruled out rent caps, arguing that boosting housing supply is the answer; renters continue to face high costs as the market cools. Climate Risk: New Gold Coast hazard maps highlight the challenge of adding homes in areas exposed to flooding, storm tides and landslides.

Mortgage Pressure: NSW households spent nearly 31% of income on mortgage repayments in June, among the highest levels in decades. An IMF inflation warning and the RBA’s hint of a possible November rate rise add to concerns. Cooling Demand: First-home buyer loan demand fell for a third straight month, while unsold auctions outnumbered sales after major banks lifted rates. Market Divide: High-end homes are sliding as conditions split across the market, and a hedge fund has bet against Australia’s housing market, targeting REA Group. Housing Supply: Regional South Australian businesses say shortages are costing them workers and contracts. Perth’s treeless fringe estates have also drawn criticism over planning rules that allow trees to be cleared.

Auction Slowdown: More homes failed to sell than sold at capital-city auctions over the weekend: 619 of 1,208 properties went unsold, leaving a preliminary clearance rate of 48.8% as higher rates weigh on buyers. Market Divide: Australia’s housing market is splitting, with high-end homes sliding even as conditions vary across other segments. Perth Planning: Tree-less estates on the city’s fringe are drawing concern, with planning rules allowing trees to be cleared and raising questions about heat and liveability. Renters: Property platforms are adding fees or paid memberships to get around the ban on credit-card surcharges, shifting costs back to tenants. Social Housing: A prefabricated apartment project has delivered 38 social homes in North Coogee, adding much-needed supply in Western Australia.

Cooling Market: Australia’s auction clearance rate stayed below 50% for a second week. In Melbourne, falling prices are yet to make homes more affordable as mortgage costs bite, while lower-priced units have dropped sharply and investors have pulled back. Affordability Squeeze: The income needed to buy an average Queensland home is rising far faster than wages, adding to pressure on buyers even as values fall. More Homes: Queensland home-building records point to stronger construction activity, while Adelaide firm Goodhouse has launched an affordable, high-efficiency “Pocket House” aimed at expanding housing options.

Market Cooling: Australian home auction clearance rates stayed below 50% for a second week, while investor activity fell 9% in the June quarter as higher rates and proposed tax changes weighed on demand. Affordability Squeeze: The income needed to buy an average home is rising despite falling prices; in Queensland, it has grown eight times faster than wages. Building More Homes: Queensland is leading the way on home-building records, while Western Australian industry leaders say new housing depends on timely delivery of water, power, sewerage and transport infrastructure. North Coogee has also added 38 prefabricated social homes. Prestige Sale: A five-bedroom riverfront home in Claremont, WA, sold off-market for $12.45 million.

Auction Slump: Australia’s clearance rate stayed below 50% for a second week, with 48.8% of 1,781 homes selling. Prices fell 5.2% nationally from March to September, while Sydney is nearly 9% below its February peak, as higher rates and tax changes weigh on buyers. Affordability Squeeze: Falling prices are not easing the strain: higher mortgage costs have pushed up the income needed to buy, with a single South Australian buyer now needing about $167,424 a year for a typical house. Melbourne Planning Fight: Labor’s plans for towers of up to 20 storeys near transport hubs are shaping up as an election issue. Advocates say more homes are needed as rents hit record highs; opponents want alternatives to the rezoning plan. Building Pipeline: Queensland recorded a fourth straight high, with 52,500 homes under construction. Nationally, home starts rose 7% in the June quarter, though builders warn rising costs are clouding the outlook.

Affordability: Falling prices are doing little to help buyers as higher rates push up the income needed for a mortgage. Canstar estimates a household needs $245,000 a year to buy an average Sydney home and $185,000 in Brisbane; in Melbourne, the number of suburbs within reach of a typical-income couple has dropped from 210 to 146 in a year. Market divide: Australian home values fell in 82 per cent of suburbs, yet a Rhodes penthouse sold for $6.35 million, setting a new apartment record for the suburb. Canberra supply: Survey work has begun at Ginninderra East, where more than 3,000 homes could be built, including 15 per cent affordable, community or public housing. First subdivision approval is not expected until 2030. Building pipeline: Home starts rose 7 per cent, but remain short of national targets; a prefabricated apartment in North Coogee has delivered 38 social homes.

Social Housing: Prefabricated components helped deliver 38 social homes in North Coogee eight months faster than usual. The $23.5 million project includes studio, one- and two-bedroom apartments. Market Pressure: Sydney’s auction scene showed the rate rise’s impact: a Coogee unit passed in below $2 million, while a Five Dock home sold for $100,000 above reserve. Prices and Rents: The downturn is spreading, with home values falling in 82% of suburbs nationally and 97% in Sydney, while rents hit a record $675 a week. Supply Gap: Building starts rose 7%, but construction remains well short of government targets, with reports pointing to a 130,000-home shortfall and a need for more apprentices.

Market Downturn: Australian home values fell across 82% of suburbs, with declines in 97% of Sydney suburbs. Geelong values have also slipped as rate rises cool investor demand. Rental Squeeze: Rents hit a national record of $675 a week, though Sydney rents eased in the September quarter and rental growth is slowing. Property Finance: Nuveen attracted more than A$1 billion for an Australian property-debt strategy, even as a property firm collapse fuels concern about risks in private credit. Housing Supply: Industry leaders warn Australia will miss its 1.2 million-home target without more apprentices, adding pressure to an already strained building pipeline.

Flood Planning: Logan City Council has endorsed changes that would remove about 26,800 properties from flood overlays, reducing the number affected from 47,225 to 20,405 after thousands of complaints. Home Prices: The downturn is spreading, with values falling in 82% of Australian suburbs and 97% of Sydney suburbs; Melbourne’s premium bayside pockets are a bright spot. Rents: National weekly rents hit a record $675, though conditions vary: Adelaide rents reached a new peak while Sydney rents fell in the September quarter and rental growth slowed more broadly. Construction and Finance: Rising costs are stalling future apartment projects, while a property firm collapse has added to fears about private credit.

Rental market: Rent growth slowed to its weakest pace in nearly two years. Sydney rents fell 0.4% in the September quarter, while national rents rose 0.5%; the median reached a record $713 a week as vacancy rates edged up and affordability pressures mounted. Housing policy: Changes to investor tax breaks are fuelling a political fight, with concerns that reduced investor appetite could further limit rental supply. Building pipeline: Dwelling starts rose 7% in the June quarter, but builders warn of a weaker outlook as costs stall future apartment projects. Housing targets are also slipping, with data-centre expansion raising fresh concerns about competition for land and power. Market pressure: Distressed property listings are surging, while reports of falling prices and unsold stock point to mounting strain for some owners and sellers.

Rental Pressure: Australian rent growth has stalled as tenants hit their affordability ceiling. House rents across capital cities were flat in the September quarter, while unit rents rose 1.5%; Sydney house rents edged lower. WA Housing Supply: Applications have opened for the state’s $250 million Pre-sale Guarantee, which can cover up to half of a development’s unsold homes at completion. The scheme aims to help apartment and townhouse projects secure finance and unlock up to 1,200 homes. Building Shortfall: Dwelling starts rose 7% in the June quarter, but construction remains well behind national targets. Rising costs are also stalling future apartment projects, despite a busy construction pipeline.

Housing Supply: Dwelling starts rose 7% in the June quarter to 52,201, but Australia remains behind its housing target. Builders warn a shortage of apprentices could slow construction further. Data Centre Pressure: A proposed $15 billion Wagga Wagga data centre is drawing local opposition over its use of farmland, power and water, as the boom raises concerns about competing with housing for resources. Mortgage Stress: Distressed property listings climbed 29.2% year-on-year in September, though they remain relatively low. Rental Squeeze: House rents were flat across capital cities in the September quarter despite tight supply, suggesting tenants are reaching their affordability limit. Perth rents held at $750 a week. Market and Planning: Auction clearance rates fell to a three-month low, while NSW recorded its highest housing completions in five years after planning reforms.

Housing Supply Crunch: Master Builders says Australia is on track to miss the 1.2m National Housing Accord target by 262,000 homes, with early signs pointing to a softer construction pipeline. Construction Momentum: Home building starts rose 7% in the June quarter, but builders still flag a weaker outlook as the broader target gap widens. Planning Watch: Arada won its first Sydney planning approval for London Place in Campsie—156 apartments with 18 affordable units—aiming to start construction in 2Q 2027. Market Signals: Mirvac’s wholesale office fund has settled a large part interest in a premium Martin Place tower, a rare read on prime CBD pricing as rates and bond yields bite. Small Business Pressure: CreditorWatch reports hiring and expansion intentions are falling, with smaller firms most cautious—another headwind for the property and construction ecosystem. Energy Costs for Farms: Diesel prices are surging, hitting farmers hard during harvest and raising food inflation risk.