Are investors set to make a return in 2024?

According to PropTrack, many investors began selling off their properties in the last few years due to the significant uncertainty about the economy brought on by the pandemic due to border closures. However, investor activity has been back on the rise the past few months.

“The re-emergence in investor activity in 2023 heralds good news for the overall health of the market. This will help to drive more new construction, which will slowly rebalance supply and demand in the rental market,” PropTrack senior economist Paul Ryan said.

Indeed, the latest Lending Indicators data released by the Australian Bureau of Statistics has revealed that the value of new loan commitments for investor housing rose 1.9 per cent in November 2023 to $9.7 billion, bringing it 18 per cent higher than the same period in 2022.

Members of the broking industry have told The Adviser that they are also anticipating investor lending demand to be strong this year.

Speaking to The Adviser, mortgage broker and owner of Mortgage Choice Berwick, David Thurmond, stated that there’s “a lot of interest from investors because there’s a correlation between the top of the rate cycle and an increase in property values”.

“People are aware that property prices might take off as we start to see rates coming down. So, I think it makes sense for investors to inquire about it,” Mr Thurmond said.

Home Loan Experts senior mortgage broker Romy Dhungana said the investor landscape in 2024 will be characterised by a "shift towards sustainable and tech-centric opportunities”.

“Investors will likely show a growing interest in environmentally conscious properties and those equipped with smart home technologies,” Mr Dhungana said.

“Additionally, the continued rise of build-to-rent developments could reshape traditional investment strategies, providing investors with a more stable income stream in the long term.”

Home Loan Experts chief executive Alan Hemmings added: “If an investor can find the right opportunity, they will take it,.

“This will come down to how different markets perform. For example, property prices are predicted to perform better in Brisbane than in Sydney, and property prices are lower in Brisbane, which may make it a more attractive option for investors,” Mr Hemmings said.

“Property in our country is still seen as a way to grow wealth; this will continue to drive the investment property market.”

However, a recent survey conducted by mortgage brokerage Resolve Finance found that 19 per cent of investors intend on selling an investment property in the next 12 months and are on the lookout for alternate investment strategies to keep up with changing market dynamics.

According to the brokerage, “mum-and-dad” investors are reassessing their property portfolios as regulatory changes for investors come into effect.

Despite this, Resolve’s research also found that 61 per cent of investors intend to “ride out” the higher interest rate environment and continue to rent to the private market.

[RELATED: Almost 20% of investors to sell in 2024: Resolve Finance]