2024 is already shaping up to be the year of the unit, with unaffordable house prices, high interest rates and population growth driving buyers towards cheaper properties in convenient locations.
Recent data from CoreLogic reveals that unit values are experiencing faster growth than house prices across Australia. This trend is evident in more than half of all Australian suburbs.
In the past quarter, units outperformed houses in 633 out of 1168 suburbs analysed. Notably, Brisbane saw the most significant unit value growth at 4.1%, surpassing the 2.8% increase in house prices.
Tim Lawless, the research director at CoreLogic, explains that due to the unaffordability of houses for many buyers and diminishing supply, demand for units is on the rise. First-home buyers and investors are particularly drawn to the unit market.
A typical Australian unit is $196,000 cheaper than a house, based on the difference in median values, but in the capitals that difference is even larger, with houses costing $274,000 more.
Overall, the demand for units remains robust, reflecting changing preferences and market dynamics in the Australian real estate landscape
Lawless predicts that this trend may continue, with more suburbs witnessing stronger growth in unit prices compared to houses due to affordability constraints and limited supply.
This is also reflected in Oxford Economics Australia’s latest Residential Property Prospects report, which shows the combined pressures of population growth, challenged affordability and low numbers of apartment completions will cause unit prices to keep rising faster than house values in the near future,
“While we expect national price momentum to slow in the second half of this year, it will accelerate again in 2025, with units set to outperform houses over the forecast period,” said author and Oxford Economics senior economist Maree Kilroy.
How unit and house prices have changed so far this year
| Units | Houses | |
| National | 2.00% | 1.48% |
| Capital cities | 1.98% | 1.60% |
| Regional areas | 2.07% | 1.18% |
| Sydney | 2.05% | 1.71% |
| Melbourne | 1.51% | 0.56% |
| Brisbane | 2.25% | 2.22% |
| Adelaide | 2.90% | 2.17% |
| Perth | 3.37% | 3.32% |
| Hobart | 0.23% | -0.06% |
| Darwin | -0.49% | -0.41% |
| ACT | 1.04% | 2.13% |
Source:
https://www.hotspotting.com.au/unit-values-rising-faster
https://www.realestate.com.au/news/these-once-unloved-properties-are-tipped-to-take-centre-stage-this-year