Australia’s residential markets showed remarkable resilience over the course of 2020. 

 

National price growth over the year was still positive – around 4% for houses and around 1% for units – although there has been some significant variation between product and markets. 

 

A significant preference shift has occurred – with the ability to work from home and lifestyle choices driving a shift towards regional markets and the smaller capitals – there will be some rebalancing over the medium term. 

 

Stronger price growth is anticipated in 2021 – but again there will be variation between markets with the smaller, more affordable capitals and regional markets expected to outperform the larger capitals. Prestige markets look strong generally. 

 

For investor markets, the supply/demand imbalance will tip towards oversupply until international migration resumes, although, markets with low levels vacancy (e.g. Brisbane and Perth) will recover more quickly than the Sydney and Melbourne, where vacancy remains elevated.