Cautious optimism emerges amid modest recovery

Buyer sentiment is showing signs of improvement, driven by easing inflation and the stage 3 tax cuts, fostering a cautious sense of optimism.

Sales in Melbourne and Geelong’s growth corridors edged up by 1% in Q3, a modest recovery from earlier declines. Despite this, overall sales remain significantly below the 10-year average, reflecting ongoing market caution.

Affordability remains a critical factor shaping land sales, with buyer preferences and developer strategies increasingly focused on rebates and incentives, especially for titled lots.

The Victorian Government’s 10-year growth strategy aiming to deliver 180,000 new homes raises questions around execution. The lack of clear timelines limits its immediate influence on housing supply forecasts.

Looking ahead, 2025 is shaping up to be a potential turning point, with anticipated interest rate cuts and government initiatives like the Home Guarantee Scheme expected to drive increased market activity.