Boroondara - Winter 2024 Market Update

While recent years have presented their share of challenges, the exclusive enclave that is Boroondara showed great resilience and an unrivalled housing demand this quarter. With major investment in transport infrastructure, world-class sporting facilities, leading educational facilities, flourishing leafy open spaces, and a thriving shopping and café scene, this real estate gem consistently ensures bustling interest from active buyers looking to enter this thriving but stable purchasing environment.

As always, the premium markets in prestigious suburbs such as Hawthorn, Balwyn and Kew were minimally impacted by wider economic factors. The scarcity of these rare top end properties ensured this small segment of the market remained highly sought-after and extremely competitive. Mike Beardsley from Jellis Craig added, “The market is currently starved for good family homes in A grade locations. If we see them come Spring, vendors will be handsomely rewarded with their end sale price. Buyers are crying out for them”.

While widespread renovation and building cost challenges showed strong signs of stabilization, buyers still erred on the side of caution, resulting in a noticeable uptick in demand for turnkey and renovated properties. Therefore, unrenovated properties in particular, and the single fronted market between $1m to $2m, attracted only patchy interest. Most properties did sell, though days on market were extended, and some vendors had to realign their market values to match buyers expectations. Fully renovated 4 to 5 bedroom period homes, as well as new modern builds, sold well under robust auction environments.

Boroondara’s rental market retained high demand and low vacancy rates, which created a favourable environment for investors to maintain their position in the market.

Looking Ahead

The Boroondara residential property market has experienced a productive first half of 2024, and is poised for a positive season ahead. Responding well to the expectation that the extended period of successive interest rate rises are at the top of their cycle, predicted reductions are due early 2025. While rates have been a cautionary tale the past few years, this renewed stability is fostering healthier sentiment than seen the past few years, spurring an influx of buyers wanting to enter the market. Distressed selling has eased and the market for investors has now normalised, while construction costs will likely be an ongoing struggle until these rates drop, and the high costs of finance and other economic factors underpinning property development improve in turn. As global and local inflation look set to trend downwards, the foundation is being laid for a more sustained market as the year progresses. As Mike Sproule from Kay & Burton said, “We expect this market to continue as is over the next quarter as interest rates appear to be stabilizing, however the market may become hotter in the last quarter if interest rates begin to fall and buyers look to secure their future family homes before the next school year”. Boroondara’s buoyant property market is thriving despite the ongoing tumult of local, national and international economic conditions, and it will continue to do so.