By Michael McQueenMonday 4 Nov 2024TrendingReading Time: 5 minutes
The residential real estate landscape in Australia is poised for significant shifts over the next five years.
From technological innovations to changing buyer expectations, here are the five key trends set to define the future of the industry:
1. Generative AI: Revolutionizing Property Listings and Client Engagement
Generative Artificial Intelligence (AI) has emerged in recent years as a powerful tool for real estate agents, streamlining property marketing and personalizing client interactions. AI-driven platforms like ChatGPT and Jasper can craft compelling property descriptions, respond to buyer inquiries, and even generate marketing materials in seconds, saving agents valuable time.
Further still, AI tools like Listing AI can automatically generate property descriptions based on data inputs, while platforms like RIBBON AI create visualizations that showcase potential home upgrades, boosting the appeal of a listing. Then there are tools like Structurely and RealScout that use AI to qualify leads, provide personalized property suggestions, and track client preferences, allowing agents to deliver a more tailored experience.
Savvy sales agents, principals and industry leaders are also using generative AI to personalize email campaigns, automate lead follow-ups, and create engaging content that speaks directly to buyer needs. Incorporating AI tools in this way can not only attract more listings but can also help close sales faster by delivering tailored experiences to clients. Additionally, AI-powered insights help agents predict buyer behavior and automate follow-up communication, driving more efficient client engagement and satisfaction.
By embracing these tools, agents are not only saving time but also creating personalized, data-driven experiences that resonate with modern consumers, positioning AI as a key differentiator in the future of real estate client management.
2. A Reworking of Work and the Lure of Lifestyle
Despite growing calls for employees to return to the office, it’s hard to escape the reality that remote and hybrid work is here to stay in one form or another. This is naturally having leading many Australians to reconsider where they live. With less emphasis on proximity to CBDs, buyers are seeking larger homes in suburban or regional areas, prioritizing lifestyle amenities such as outdoor space and home offices.
In the coming years, five regions are set to benefit most significantly from this trend with growing demand forecast to further increase home values. These are:
1 – Northern Rivers, New South Wales
With stunning landscapes, proximity to the coast and reliable airport infrastructure, the Northern Rivers is drawing professionals who seek a balance between natural beauty and work flexibility.
2 – Geelong, Victoria
Close to Melbourne but offering a more laid-back lifestyle, Geelong is booming thanks to infrastructure improvements and its appeal to remote workers – especially those with young families.
3 – Sunshine Coast, Queensland
Known for its beaches and relaxed vibe, the Sunshine Coast is becoming a top destination for remote professionals, thanks to its lifestyle amenities.
4 – Southwest Western Australia (Margaret River)
Margaret River offers a unique mix of coastal and rural living, making it a prime location for remote workers seeking space and affordability.
5 – Greater Hobart, Tasmania
Tasmania, especially the Hobart area, is drawing attention from professionals who are seeking a slower pace of life without losing access to city conveniences.
Regardless of the suburb or region an agent is operating in, the new normal for work highlights the importance of focusing marketing efforts on properties that cater to the work-from-home lifestyle. Highlighting features like extra office space, fast internet, and proximity to lifestyle amenities can make all the difference.
3. Sustainability and Eco-Friendly Homes Are a Must
Sustainability is no longer a nice-to-have—it’s becoming a key consideration for buyers. More Australians are looking for eco-friendly homes with energy-efficient features, such as solar panels, water-saving technologies, and high energy ratings.
Mirvac’s House with No Bills initiative, a pilot home in Melbourne, demonstrates the demand for energy-efficient living. This home produces more energy than it consumes, setting a new standard for sustainable housing in Australia.
To capitalize on buyers’ appetite for sustainable housing, real estate agents should promote eco-friendly features.
Indicative of the priority buyers are placing on sustainability and climate change, in October 2024 real estate giant Zillow took the step of including a ‘climate score’ on listed properties. Designed to help buyers make informed decisions about risks relating to floods, fires, heat and air quality, Zillow’s senior economist Orphe Divounguy cites research showing 80% of buyers view climate change as key factor in home purchasing decisions.
To capitalize on buyers’ appetite for sustainable housing, real estate agents should promote eco-friendly features in listings, including energy-efficient appliances, solar panels, and insulation. Furthermore, encouraging sellers to invest in sustainable upgrades can make their property more attractive to future buyers.
4. Gen Z: The Future of Real Estate in Australia
As we approach 2030, Generation Z is set to become a driving force in Australia’s real estate market. According to industry forecasts, 20-25% of home buyers will be Gen Z by 2030. Their unique approach to the home-buying process will shape how real estate is marketed and sold. Unlike previous generations, Gen Z prefers email, instant messaging, and social media platforms over phone calls, with TikTok emerging as their platform of choice. Unlike Millennials, they largely avoid Facebook, demanding a shift in how agents communicate.
As we approach 2030, Generation Z is set to become a driving force in Australia’s real estate market.
With Gen Z home buyers preferring instant, asynchronous communication over traditional methods, real estate agents must embrace AI tools to automate client engagement and deliver personalized, fast responses. Automated chatbots, email campaigns, and social media messaging are critical, as Gen Z demands efficiency and quick answers when browsing properties. AI-driven platforms like Structurely can respond to inquiries in real-time, providing tailored suggestions without the need for immediate human intervention. This seamless engagement builds trust while catering to Gen Z’s preferred digital communication channels.
Beyond their influence as buyers and sellers, Gen Z will also comprise a significant portion of the real estate workforce. By 2030, they are expected to make up around 30% of the industry, bringing fresh perspectives and a digital-first approach to sales, marketing, and client engagement.
5. New Forms of Family Norms
Australia is experiencing significant demographic shifts, with multi-generational living on the rise. Many buyers are looking for properties that can accommodate extended family members. This trend is driven by affordability concerns, the aging population, and cultural preferences for family-centric living arrangements.
Developments in outer suburbs and regional areas, such as Lendlease’s Yarrabilba community in Queensland, are offering larger homes with flexible spaces designed for multi-generational families. This is likely going to be the way of the future.
To capitalize on this trend, it pays to highlight properties that feature additional living areas, dual-income potential, or self-contained spaces in listings. For developers and investors, focusing on multi-generational designs could be a lucrative opportunity in the coming years.
Adapt or Be Left Behind
As the residential real estate sector evolves, staying ahead of these trends is essential for continued success. From embracing AI innovations to catering to changing buyer demands, the next five years will bring both challenges and opportunities. By positioning yourself and your business at the forefront of these shifts, you can build lasting relationships with clients and maintain a competitive edge in a dynamic market.
The future belongs to those who are prepared. Are you ready?
Article supplied with thanks to Michael McQueen.
About the Author: Michael is a trends forecaster, business strategist and award-winning conference speaker.
Feature image: Photo by Maximillian Conacher on Unsplash