As a property investor, understanding the Australian property market is crucial for making informed decisions that can lead to financial success. Researching the property market is an indispensable step for anyone aspiring to achieve financial freedom through property investment. A well-researched market analysis not only minimises risks but also increases the chances of higher returns. This guide is crafted to give you detailed insights and actionable strategies for understanding the property market like an expert.

Why Researching the Property Market is Crucial

Property investment is not just about purchasing a property; it’s about making strategic decisions based on facts, trends, and future potential. The Australian market varies significantly across regions and cities, making localised knowledge essential for mitigating risks and securing higher returns.

• Mitigate Risks:
  Comprehensive research helps identify potential red flags such as oversupplied areas or properties with stagnant growth. For instance, if an area has seen rapid development without corresponding population growth or infrastructure support, it may signal oversupply risks.
• Maximise Returns:
  By targeting high-demand areas or suburbs with planned infrastructure developments (e.g., new schools or transportation links), you can secure properties with better growth prospects. These developments often drive up property values by enhancing local amenities and accessibility.
• Plan for the Future: Understanding market trends ensures your investment aligns with long-term financial goals. This involves staying updated on economic factors like interest rates and government policies that influence housing demand.

Steps to Conduct Effective Property Market Research

1. Understand the Current Market Trends

Start by assessing the overall market conditions. Is the market favouring buyers or sellers? Look into key metrics like:

• Median Property Prices: Check how prices in your target area compare to the state or national average. Primary resources like SQM Research, Proptrack, CoreLogic offers detailed, data-driven property reports.
• Rental Yields: High rental yields typically reflect strong demand for rental properties, making them a solid choice for investors.
• Auction Clearance Rates: Higher rates often indicate strong demand, while lower rates may signal a cooling market.
  

In December 2024, CoreLogic reported slight declines in combined dwelling values nationwide but noted regional variations like Brisbane, Adelaide and Perth showing resilience. Understanding these dynamics helps investors identify opportunities in specific markets.

2. Analyse Location-Specific Factors

The location of your investment property can significantly impact its growth potential. When researching suburbs or regions, evaluate based on:

• Population Growth: Areas experiencing rising populations typically see increased housing demand.
• Employment Opportunities: Proximity to business hubs boosts rental appeal.
• Infrastructure Development: Projects like new schools or transport links enhance local appeal. Use platforms like Australian Bureau of Statistics, Corelogic or PropTrack to gather demographic and infrastructure data.

3. Evaluate Supply and Demand

An imbalanced market can indicate potential risks or opportunities:

• High Demand, Low Supply: Properties in such areas often appreciate faster.
• Oversupply: Be cautious of regions with excessive housing developments, as this could lead to stagnant or falling prices. If an area has seen rapid construction without corresponding population increases (e.g., due to lack of job opportunities), it might face oversupply challenges leading to stagnant prices.
  

4. Research Comparable Sales and Listings

Comparing properties in your target area gives you a realistic idea of market prices. Tools like Domain and realestate.com.au allow you to view recent sales and active listings.

Key Questions to Ask:

• Are properties selling above or below the asking price?
• How long are listings staying on the market?

Read More: Best 5 Highest Yield Investments in Australia in 2024

Liviti’s Top Tips for Effective Research on Property Market

1. Leverage Technology and Tools

Utilise publicly authorised online platforms to gather data on prices, rental yields, and historical growth rates. Additionally, consider property market reports from reliable sources such as CoreLogic or SQM Research.

2. Attend Open Homes and Auctions

Physical inspections and live auctions provide first-hand knowledge of market conditions and buyer behaviour.

3. Network with Industry Professionals

Engage with real estate agents, mortgage brokers, and property managers to gain insider insights. They often have access to market trends that might not be publicly available.

4. Stay Updated on Economic Factors

Interest rates, inflation, and government policies (like stamp duty concessions or first-home buyer grants) directly influence the property market. Regularly review updates from the Reserve Bank of Australia (RBA) or government websites.

Key “Property Market” Red Flags to Watch Out For

• Volatile Market Conditions:
  Avoid investing during unpredictable fluctuations unless you have a clear strategy.
• Poor Rental Demand:
  Low tenant interest could lead to extended vacancies.
• Over-Development:
  Areas with too many developments risk price stagnation or oversupply.

Researching the property market is not a one-time task but a continuous process that demands dedication and a keen eye for detail. By thoroughly analysing market trends, location dynamics, supply and demand, and comparable sales, you position yourself for success in property investment.

Remember, the key to building a robust investment portfolio lies in making informed decisions backed by data and expert insights. With careful research and strategic planning, you can turn property investment into a powerful tool for achieving financial freedom.

Learn about the property investment strategies you definitely need to know from our experts at Liviti Property!

Frequently Asked Questions (FAQs) on how to research the property market in 2025

1. Will Australian house prices rise in property market 2025?

Yes, 65% of real estate agents predict price growth, driven by improving affordability and potential interest rate cuts. CoreLogic reports Queensland leads with 70% of agents forecasting gains, while Melbourne’s median dwelling value ($774,000) may recover after a – 6.4% dip from its 2022 peak.

2. Which Australian regions have the best growth potential in 2025?

Adelaide, Perth and Brisbane are top performers due to internal migration and infrastructure projects. Regional markets like Toowoomba also show resilience, with 25% of agents expecting gains over 5%.

3. How do interest rates affect property investment in 2025?

Expected RBA rate cuts in late 2025 may boost borrowing capacity and demand. KPMG projects a 0.5% rate drop could stimulate price growth, particularly in high-demand suburbs near employment hubs.

4. Are units or houses better investments in 2025?

Units are gaining traction due to affordability, with price growth outpacing houses. CoreLogic notes units now appeal to first-home buyers and investors seeking lower entry points (e.g., $350k Adelaide CBD apartments).

5. What are the risks of investing in regional Australia in 2025?

Oversupply in areas without population growth or infrastructure support poses risks. Focus on regional hubs with employment links (e.g., Parramatta’s Western Sydney Airport project) to mitigate volatility.

6. How will the 2025 federal election impact property markets?

Housing policies (tax incentives, supply initiatives) will dominate campaigns. REIA highlights supply constraints and affordability reforms as critical election issues influencing investor decisions.

7. Is buying cheaper than renting in Australia in 2025?

In 35% of suburbs, buying now costs less than renting due to soaring rents. PropTrack advises using tools like loan-to-value ratios (LTV) to assess long-term affordability despite rising deposits.

8. What sustainable features add value to properties in 2025?

Solar panels, energy-efficient designs, and water-saving systems boost appeal. CoreLogic data shows eco-friendly homes sell 7-10% faster in cities like Sydney and Melbourne.

9. How do I research local property markets effectively?

Use ABS population data, CoreLogic reports, and auction clearance rates. Attend open homes and partner with agents for hyper-local insights (e.g., school zones, transport links).

10. What should first-home buyers prioritise in 2025?

Target suburbs with infrastructure projects (e.g., new schools) and government grants. PropHero recommends units in Brisbane or Adelaide for lower deposits and stable rental yields (4%).