Australian Property Market – Prices, Trends, Forecast [February 2025]

Key Updates for Homeowners

• National home values remained steady in January, with a slight decline in capital cities (-0.2%) but growth in regional areas (+0.4%) to new record highs.
• Brisbane, Adelaide, and Perth continue to grow, though at a slower pace, while Melbourne, Sydney, and Canberra saw declines.
• Annual home value growth has slowed significantly, down from a peak of 9.7% in early 2024 to 4.3% in January 2025.
• Regional markets remain strong due to affordability, internal migration, and flexible work arrangements.
• A potential interest rate cut may provide support to home prices, but affordability challenges and economic conditions may limit rapid growth.
• Rental price growth is easing, especially in Sydney and Melbourne, providing some relief for renters after years of increases.
• Buyers have more choices now, with listings up 7.7% year-over-year, especially in Sydney, Melbourne, Hobart, and the ACT.
• Construction activity is improving, but high costs and supply chain challenges are keeping housing supply below demand.

For insights on how your local market is performing and your property’s value start here. 

Property Price Growth By City

This chart shows the percentage change in property values across different locations in Australia. Select the property type, time period, and whether to include regional areas to compare market trends.

All Dwellings Houses Units Show Regional

Month

Quarter

Annual

Total Return

Median Value

Month Quarter Annual Total Return Median Value

CoreLogic Home Value Index, Released on 3rd February 2025

Sydney

• Market Performance: Sydney’s housing market softened in February, experiencing a 0.4% decline in dwelling values for the month and a 1.4% drop over the past three months. This marks Sydney as one of the weaker-performing capital cities, with annual price growth at just 1.7%, the lowest since June 2023. Despite this, Sydney remains Australia’s most expensive property market, with a median dwelling value of $1,193,228.
• Key Insight: Sydney’s property market is experiencing a correction, with moderate price declines and rental easing. While the outlook remains cautiously optimistic, high prices, affordability issues, and economic headwinds suggest that any major rebound will take time. For buyers, increasing stock levels and potential rate cuts may present better purchasing opportunities in the near future.

Read More: Latest Property Market Update for Sydney

Melbourne

• Market Performance: Melbourne’s housing market has continued to experience declining values, with home prices falling 0.6% in January and 2.0% over the past three months. Over the past year, Melbourne has recorded a -3.3% annual decline, making it one of the few capital cities with negative growth. The median home value in Melbourne now stands at $772,317, reflecting the ongoing softness in the market.
• Key Insight: Melbourne’s housing market remains in a downward phase, with falling values, weak demand, and declining rental prices. While potential rate cuts may provide some stability, affordability issues and soft economic conditions will likely keep a strong recovery at bay in 2025.

Read More: Latest Property Market Update for Melbourne

Brisbane

• Market Performance: Brisbane’s property market continues to grow, though the rate of increase has slowed. While still among the strongest-performing capitals, the detached housing sector has experienced a noticeable deceleration. Despite this, Brisbane remains a key driver of national housing value appreciation.
• Key Insight: Brisbane remains one of Australia’s strongest markets, but value appreciation is slowing. Future performance will largely depend on interest rate movements, affordability constraints, and supply-side factors. Investors and homebuyers should expect gradual rather than explosive growth in 2025.

Read More: Latest Property Market Update for Brisbane

Adelaide

• Market Performance: Adelaide continues to show strong resilience in its property market, leading capital cities in value growth over the past six months. While the rate of increase is slowing, the city remains one of Australia’s top-performing markets.
• Key Insight: Adelaide remains a leading performer in Australia’s housing market, showing resilience and strong value growth despite broader economic headwinds. While the pace of gains is moderating, limited housing stock and stable demand suggest further moderate growth in 2025.

Read More: Latest Property Market Update for Adelaide

Perth

• Market Performance: Perth’s housing market remains in a growth phase, albeit at a slower rate compared to previous quarters. While still outperforming most capital cities, recent trends indicate moderating momentum in value appreciation. The market continues to benefit from affordability advantages and strong migration-driven demand.
• Key Insight: Perth’s property market remains one of the strongest in Australia, with high annual growth and solid rental returns. However, the pace of appreciation is slowing, signaling a more balanced market in the near term. Buyers and investors should expect steady, but more tempered growth, as affordability constraints and economic conditions play a more significant role in shaping market dynamics.

Read More: Latest Property Market Update for Perth

Canberra

• Market Performance: Canberra’s housing market continues to experience mild declines, reflecting broader capital city trends. Dwelling values in the ACT dropped 0.5% in January, contributing to an annual decline of 0.5%. The median dwelling value in Canberra is now $850,534, positioning it as one of the more expensive capitals in Australia. The downturn is part of a longer-term cooling trend, with the market 7.1% below its peak from May 2022.
• Key Insight: Canberra’s housing market remains in a correction phase, with softening values and sluggish demand. While potential interest rate cuts may support buyer confidence, affordability constraints and a higher supply of properties suggest that significant price rebounds are unlikely in the near term. Investors may find better rental yields elsewhere, while buyers have more negotiating power in a cooling market.

Read More: Latest Property Market Update for Canberra

Hobart

• Market Performance: The Hobart housing market has remained relatively stable over the past month, with no change in dwelling values recorded in January 2025. However, on a quarterly basis, values declined by 0.8%, and over the past year, Hobart home values have dropped by 0.4%. Despite this slight downturn, the total return on investment remains positive at 3.9%, with the median dwelling value at $658,180.
• Key Insight: Hobart’s property market has undergone a significant correction since 2022 but appears to be stabilizing. Falling prices have improved affordability, while strong rental yields remain a positive factor for investors. However, with weaker demand and higher stock levels, growth is likely to be limited in the near term. Buyers and investors should remain cautious and focus on suburbs showing resilience or higher rental returns for the best opportunities in 2025.

Read More: Latest Property Market Update for Hobart

Darwin

• Market Performance: Darwin’s property market has demonstrated modest growth in the past year, contrasting with more volatile trends observed in other Australian capitals. With a median dwelling value of $502,632, Darwin remains one of the most affordable capital cities in the country. While national property trends show a mix of stagnation and slowdowns, Darwin has maintained a positive trajectory, albeit at a subdued rate compared to the more robust markets of Perth and Adelaide.
• Key Insight: While Darwin is not experiencing the rapid price surges seen in Perth or Adelaide, its steady growth, affordability, and strong rental yields position it as a stable investment option. The outlook remains cautiously optimistic, with further price appreciation dependent on interest rate cuts and economic stability. Investors may continue to find Darwin appealing for rental returns, but prospective buyers should temper expectations for significant capital gains in the near future.

Read More: Latest Property Market Update for Darwin

Australian Property Market Trends

Change in dwelling values over key time periods

Region	From Peak	Peak Date	Past 10yrs	Since Onset of COVID
Sydney	-1.70%	Sep-24	68.60%	27.30%
Melbourne	-6.90%	Mar-22	47.50%	7.80%
Brisbane	<at peak>	<at peak>	90.80%	68.20%
Adelaide	<at peak>	<at peak>	93.40%	73.10%
Perth	<at peak>	<at peak>	55.00%	76.70%
Hobart	-12.50%	Mar-22	87.20%	26.90%
Darwin	-6.00%	May-14	-2.90%	25.30%
Canberra	-7.10%	May-22	61.80%	29.90%
Regional NSW	-2.20%	May-22	98.50%	50.10%
Regional Vic	-8.40%	May-22	73.80%	30.80%
Regional Qld	<at peak>	<at peak>	88.70%	69.30%
Regional SA	<at peak>	<at peak>	70.10%	72.10%
Regional WA	<at peak>	<at peak>	49.40%	76.70%
Regional Tas	-2.90%	May-22	91.90%	47.70%
Regional NT	-11.80%	Apr-16	-8.70%	-4.00%
Combined capitals	-0.70%	Sep-24	65.70%	33.30%
Combined regionals	<at peak>	<at peak>	86.40%	55.60%
National	-0.30%	Oct-24	70.30%	38.00%

Australian Property Market Forecast

The Australian banks forecast:

• ANZ predicts a 5-6% increase in capital city property prices in 2024, with Brisbane expected to see the highest rise at 9-10%, Perth property values could go up by 1-11%, Sydney by 4-5%, and Melbourne prices by 2-3%.
• CBA forecasts a 5% rise in capital city prices, with some variations: Brisbane is anticipated to grow by 6%, Melbourne and Perth by 5%, Sydney by 4%, and Adelaide by 1%.
• NAB projects a 5.4% average increase across the capitals, with Brisbane expected to see a 6.5% rise, Perth and Adelaide by 6.2%, Melbourne by 5.5%, Sydney by 5%, and Hobart remaining flat.
• Westpac expects a 6% growth across the combined capitals, with Perth leading at 10%, followed by Brisbane at 8%, Sydney at 6%, Adelaide at 4%, and Melbourne at 3%

Oxford Economics has also released a three year property price forecast.

City	Median Price* (Houses)	Median Price*(Units)	Total Price** (%) Growth (Houses)	Total Price ** (%) Growth (Units)
Sydney	$1.93M	$1.09M	18%	22%
Melbourne	$1.28M	$0.78M	21%	20%
Brisbane	$1.21M	$0.71M	19%	23%
Adelaide	$0.95M	$0.69M	16%	18%
Perth	$1.05M	$0.64M	30%	30%
Canberra	$1.17M	$0.75M	19%	20%
Hobart	$0.86M	$0.71M	13%	16%
Darwin	$0.70M	$0.46M	24%	26%
Combined Capitals	$1.34M	$0.87M	20%	21%

For the second half of 2024 this means:

• Modest value increases expected: The national housing market is likely to see modest value increases through the end of 2024, driven by a persistent imbalance between supply and demand.
• Affordability constraints: Affordability pressures, high interest rates, and cost-of-living challenges are expected to temper growth, especially in higher-priced markets.
• Sustainability of growth: High growth levels in cities like Perth, Adelaide, and Brisbane may be difficult to sustain as affordability becomes more stretched.
• Shift to affordable segments: Demand is increasingly focused on more affordable market segments, with significant growth in the lower quartile of the market.
• Construction Sector Constraints: Ongoing issues in the construction sector, including labor shortages and competition from public infrastructure projects, are likely to keep supply constrained, supporting property values in the longer term.

Australian Property Clock Update

Each month, independent property valuation firm Herron Todd White (HTW) publishes a residential property report that assesses the performance of Australia’s 50 largest markets. HTW’s Property Clock grades each market based on current and predicted performance to determine whether it’s rising, falling, peaking or bottoming out. 

Australian Property Clock: Houses

Australian Property Clock: Units

Conclusion

The CoreLogic Home Value Index report for February 2025 highlights a complex housing market characterized by diverging trends across different regions. While national home values have remained relatively steady, there has been a notable divergence between capital cities and regional markets. Regional areas have continued to record growth, supported by factors such as internal migration, affordability advantages, and evolving work-from-home trends.

However, the overall housing market is experiencing a slowdown, with annual value growth halving from its peak in early 2024. Some capital cities, including Melbourne and the ACT, have recorded declines in home values, while markets such as Perth and Adelaide have remained more resilient. The easing of growth in key capital markets signals broader affordability constraints and a cooling in buyer demand.

Rental growth, while still above historical averages, has also begun to moderate, providing some relief to tenants. Factors such as an increase in rental supply, affordability pressures, and slowing population growth are contributing to this easing trend.

Looking ahead, the anticipated reduction in interest rates is likely to provide some support to housing prices and borrowing capacity. However, ongoing challenges—including affordability constraints, normalizing population growth, and potential credit tightening—suggest that a significant upswing in housing values is unlikely in the near term.

Overall, while some positive momentum is expected due to interest rate cuts and low new housing supply, the market remains in a transitional phase, with affordability pressures and broader economic conditions acting as key determinants of future performance.

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