Key takeaways
National capital city median house prices rose by 0.6% in May, marking three consecutive months of growth and lifting annual growth to 4.5%.
This rebound is largely driven by improved affordability and buyer confidence following two RBA interest rate cuts—one in February and another in May—after a long period of monetary tightening.
National unit prices grew 0.6% in May—the fourth straight monthly rise—and are now 3.9% higher year-on-year.
Melbourne house prices are now flat year-on-year, indicating a full recovery from prior declines.
Monthly growth in both houses and units suggests the city is entering a new growth phase, spurred by lower interest rates, strong employment, and a pickup in buyer activity after subdued performance in 2023–24.
The outlook for 2025 remains optimistic, especially for Melbourne and Sydney, which are gaining momentum
National home prices have surged over June, reflecting the significant impact of RBA interest rate cuts in February and May on affordability and market confidence.
The national capital city median house price was up strongly by 1.0% over the June quarter to $1,198,912 compared to the May quarter, according to the latest data from My Housing Market.
The June national house price result was the highest monthly growth recorded since March 2024 and the fourth consecutive monthly rise in prices with house prices now 5.6% higher over the past year.
All capitals reported house price increases over June with the exception of Canberra that fell 0.7%.
A rebounding Perth was the top performer up sharply by 2.2% followed by the consistently strong Brisbane higher by 2.1%, Hobart up 1.3%, Darwin higher by 1.1%, Adelaide up 0.9%, Sydney increased 0.6% and Melbourne higher by 0.5%.
Perth, Adelaide, Brisbane and Darwin, have reported the highest house price increases over the past year - higher by 11.6%, 9.7%, 9.2% and 6.5% respectively.
Apartment / Unit Market Update
National unit prices were higher for the fifth consecutive month over the June quarter, rising by 0.7% to $681,890 and remained 3.7% higher than the June quarter 2024 result.
Perth was again the top monthly performer with unit prices rising strongly over June by 2.0% followed by Canberra increasing 1.1%, Adelaide up 0.8%, Sydney and Brisbane each higher by 0.7% and Melbourne up 0.6%.
Hobart and Darwin unit prices however fell 3.4% and 3.5% respectively over the month.
Brisbane, Perth, Hobart, Adelaide and Darwin have recorded clearly the highest annual unit price growth over the year ending the June quarter 2025 up by 15.8%, 15.1%, 12.6%, 12.2% and 7.5% respectively.
Sydney annual unit prices are now higher by 2.0% with Melbourne annual unit price now up 0.2% but Canberra lower by 2.3%.
- Also read:Lower Interest Rates Drive Home Prices Higher and Higher Over June | Latest Housing Market Stats Dr. Andrew Wilson
- Also read:52 years of valid reasons not to invest
- Also read:Why Testamentary Trusts Aren’t Just for the Rich: A Guide to Safeguarding Your Legacy Introduction
- Also read:Why the ALP’s Grand Plan to Build 1.2 Million Homes Is Destined to Fail – A Reality Check
- Also read:Here’s how I’ll be investing in property in 2023
Comment
Capital city housing markets have maintained the positive results of previous months with home prices continuing to rise strongly over the June quarter compared to the previous May quarter.
The May decision by the RBA to again cut official interest rates following the February reduction – the first cut in over 4 years, continues to support strengthening housing market activity by increasing buyer confidence and improving affordability.
House price growth over June was particularly strong in a rebounding Perth and ongoing robust Brisbane, with Darwin and Hobart also reporting sturdy results.
Unit price growth also remains relatively positive, although overall results were again lower compared to houses over the month. Melbourne continues to report solid monthly results, with unit prices now rising over five consecutive quarters for the first time since July 2023
2025 is set to continue to produce positive results for housing markets, particularly in the major capitals; fuelled by improved affordability and rising confidence generated by lower interest rates.
Prices growth in the recent boom-time markets of Brisbane, Adelaide and Perth however is likely to be lower than the heady results recorded through 2024.
Sydney is set to continue to report solid results with the Melbourne market now providing clear signs of a better year for prices growth for both houses and units.
Underlying drivers will continue to support housing market activity generally, with the possibility of further RBA rate cuts that will support housing market activity and continue to generate higher home prices.
The national economy remains strong with continuing low jobless rates and strong jobs growth driving higher wages that will be enhanced by interest rate cuts. The recent surge in retail sales also reflects heady consumer activity and confidence.
Although high post-COVID migration levels have eased recently, numbers remain strong and continue to add to chronic housing undersupply supporting high rents and low vacancy rates generally in capital city rental markets.
Following a period of easing over recent months, the latest data is reporting a general tightening of vacancy rates and rising tenant demand, with higher rents again likely to follow.
High rents and higher prices continue to provide clear incentives for first home buyers and investors chasing solid investment returns.
New government initiatives to support first home buyers will also act to place upward pressure on prices.
Capital city housing markets generally recorded higher house and unit prices over 2023 and 2024, and have accelerated over June following a typically quieter start to 2025 reflecting early year seasonal influences.
National home prices are set to record positive growth again over 2025 similar to the results of the previous two years supported by lower interest rates, a continuing strong economy and chronic low levels of new home construction.
