Number of Housing Transfers

IBISWorld forecasts the number of housing transfers to drop in 2024-25 by 7.7% to 329,520. Various factors, including residential housing prices, population growth, mortgage affordability, interest rates, savings rates, and consumer sentiment, drive the total number of housing transfers. The projected decline in Australia’s housing transfers for 2025 stems from a complex interplay of economic challenges, policy constraints and demographic shifts. Elevated interest rates and widening affordability gaps dampen buyer enthusiasm, while new taxes and stringent regulations, particularly in Victoria, deter investors like the Reduction of Land Tax Threshold and Vacant Residential Land Tax (VRLT) Expansion. Simultaneously, a decline in building approvals amid ambitious government housing targets exacerbates supply shortages. High net migration intensifies demand pressures, straining the already limited housing stock. Investor caution and reduced financial support for first-time buyers further slows market activity. Stabilising yet unaffordable rents and low vacancy rates continue to influence market dynamics, highlighting the need for coordinated action to restore confidence in the housing sector.

The relationship between residential property prices and housing transfers is intricate and influenced by various factors. Chief among these is the balance between credit availability, housing affordability and the number of properties for sale. Climbing property prices typically motivate more people to sell, as they can realise higher gains and have a greater ability to either downsize or upsize. Additionally, increasing prices enhance buyer confidence in the housing market, encouraging both owner-occupiers and investors with the prospect of higher returns on investment over time. However, affordability complicates this relationship.