The only way is up: Survey shows upgraders have emerged as Australia’s most active residential buyer group

Upgraders have overtaken first home owners to be the most active residential buyer cohort in Australia, a new CBRE survey shows.

CBRE polled 155 residential valuers across the country for the Q4 Residential Valuer Insights report, to provide expert insights on local and national trends.

Key findings include that first home owners – the most active buyer group in the previous three 2024 quarters – have been usurped in Q4 by upgraders.

The survey also highlights that unrenovated properties and homes in secondary locations are ranking lowest on buyer wish-lists, while new homes and renovated assets are most in favour,

CBRE’s Pacific Head of Research, Sameer Chopra noted, “In the short-term, until we get meaningful interest rate cuts, I expect upgraders and first home buyers will continue to dominate demand. Down the track, the downsizer and investor market could become more active once there is more confidence in demand and pricing.”

At a top-line level, the report highlights diverging trends by city. While half of CBRE’s valuers reported moderate buyer demand in their local markets, 34% said demand was strong to very strong.

The demand side of the equation is being led by Adelaide and Perth, with softer demand evident in Melbourne.

CBRE’s Residential Valuations National Director Kat Hale attributed the divergence to buyer demographics and locational trends.

“Melbourne has seen less demand from investors due to tax changes and proposed landlord rental standards. This has fuelled increased investor activity in both Adelaide and Perth. Notably, the demand for recently renovated and new properties has remained strong throughout 2024,” Ms Hale said.

Other key report findings include:

• Behind upgraders and first home buyers, investors and downsizers are also active, while developers and recent overseas migrants are less active.
• 55% of the valuers surveyed expect house value growth in the next year, down from a peak of 78% in Q1, 2024. The highest growth is expected in Perth and Adelaide, with 25% of Sydney metro valuers expecting over 5% growth.
• 38% of the valuers surveyed expect an increase in apartment values, with the highest conviction being for Brisbane Metro, Perth, and the Gold and Sunshine Coasts. Nationally, twice as many valuers expect value growth vs value decline.
• A declining number of valuers expect buyer demand to increase over the next 12 months. The strongest demand is expected in Sydney Metro, Sydney Outer Metro, and Melbourne Metro.
• Form a future supply (listings) perspective, two thirds of the valuers surveyed expect an increase in available stock over the next 12 months – the highest result this calendar year, with the most supply anticipated in Canberra and the Sydney Metro area.

Most Active Buyers in Australia in the Past Three Months

Source: CBRE Research