The top property trends to watch in the major states

Queensland

Looking over the last seven years of property data in the state, Mr Reardon said the market was “not too interesting” as it cycles through boom/bust cycles in its apartment cycle.

“They’ll go again, their apartments are clearing the market, there’ll be another suite of apartments built in Brisbane in the near-future,” Mr Reardon said.

Detached housing particularly in South-East Queensland is as equally uninteresting, with Mr Reardon labelling it as “strong, but not remarkable”.

“Their pipeline of work has relatively short, and at the end of last year, it tightened up extremely quickly [with a] 20 per cent drop off in approvals, and a reasonable share of those were builders volunteering spec homes into the market, so it’s one we’re a little pessimistic about,” he said.

“With still the strong population growth, they should be achieving better outcomes than what they are, so that there is our forecast for Queensland for the next couple of years.”

Victoria

Over to Melbourne, Mr Reardon said the capital city was benefiting after the mining boom, attracting the workforce from Western Australia, the Northern Territory and North Queensland.

In terms of its multi-unit market, the chief economist said the lead up to the state elections reduced approvals, while detached houses are a different story.

“Detached houses are holding on particularly strongly for much longer that what we would have expected, and it’s because that population growth remains up at 2.2 per cent,” Mr Reardon said.

“Our forecast there for detached, Victoria is coming off a little, but still relatively strong.”

NSW

While the credit squeeze has been felt in Sydney for a while now, Sydney was the first area in the state to be impacted by the squeeze, and the rest of the state has lagged behind in this regard, Mr Reardon claimed.

“It's not quite as significant in the rest of NSW,” Mr Reardon said.

“The rest of NSW is still catching up to the house price boom that Sydney had at that positive wealth effect, where you saw from house price increases, and possibly the great beneficiary of that is Newcastle [and] the Hunter region. Their market is going to come off a little this year, but not significantly.”

Into the Sydney market, Mr Reardon pointed out a noticeable reduction in multi-unit approvals and detached housing, but the decline is not as severe than in other states.

“It hasn’t been as sharp as what it was say in the south-east corner of Queensland, but still the market is going to continue to correct a long way back to more historically average numbers, and so, [the] last five years of home building has driven the national economy,” he said.

“For the next five years, we’re going to need the national economy to keep us up, and at this stage, all indications are the rest of the economy will hold us up from a deep downturn.”

Australian Capital Territory

The chief economist said the nation’s capital “marches to a very different beat” as Canberra deals with a mini-correction.

The first major property trend noticed in the territory is an increase of apartments coming onto the market, Mr Reardon said.

“There’s an enormous volume of apartments coming onto the market; in fact, around 75 per cent of new homes in Canberra at the moment are apartments, which means at some stage in the near future, we’re going to see the markets swing back the other way back to detached houses,” he said.

“There’s a significant shortage of detached land blocks in the ACT at the moment. We’ll see those pick up in the next couple of years.”

The second trend, the chief economist identified, was the resulting fallout of the ACT’s rail project concluding.

“We’ve seen an increase in supply, the same time the light rail project, which started after the one in Sydney and has now been finished,” Mr Reardon said.

“Those workers have now left Canberra, so we’re seeing just a little bit of a gap in the market, but it will clear fairly quickly; very large disposable income, strong population growth [and] I wouldn’t be concerned by that pull off in terms of multi-units.

“So, it will remain one of the strongest housing markets in the country, along with the Hunter region as well.”