Report | Intelligent Investment

Pacific Market Outlook 2024

January 30, 2024 20 Minute Read

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CBRE's 2024 Pacific Market Outlook highlights key trends and overarching themes that will guide market shifts and decision making.

What will provide a “triple boost” for Australia’s living sector, just how many interest rate cuts will we see this year and next, when will commercial property transaction activity bounce and how high will that bounce be?

These are some of the topics covered in the report, which also explores the more balanced outlook for investment returns, with mid to high single-digit income growth and flat to modestly higher capital values expected in Australia by the end of 2024.

In 2024, you can have both. We see income growth and capital gains across sectors.
Sameer ChopraHead of Research, Pacific & ESG, Asia Pacific

2024 Key Opportunities

  1. The “triple boost”

    The wealth effect driven by Australia’s rising population, rising employment and rising incomes will add circa $860 billion of income over the next decade, a significant proportion of which is likely to be directed towards the living sector.
  2. Rent-a-demic to continue

    No rental respite is expected in the industrial and residential sectors as vacancy remains tight, while future supply could be challenged by elevated construction costs.
  3. Transaction activity to bounce

    Falling bond yields should reduce some of the price anxiety around transactions, with activity likely to recover this year before a resurgence in 2025.
  4. Interest rate predictions

    CBRE’s expectation is for two 25bps cuts from mid-2024, followed by two 25bps cuts in the first half of next year. With gearing in the commercial property industry below 30%, forced selling is unlikely.

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