By Michael Yardney February 24, 2025

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This week’s Australian Property Market Update – Latest Data, State by State February 25th 2025

Property Market News
This week’s Australian Property Market Update – Latest Data, State by State February 25th 2025

Key takeaways

As we kick off 2025, the Australian property market presents a complex landscape of opportunities and challenges.

The Labor government announced that it will introduce a two-year ban on the purchase of established homes by foreign investors, in the hopes of easing pressure on the housing market. In reality, it won't make any real difference.

This week, CoreLogic Research reports that:

*Sydney property prices increased 0.2% over the last week, remained flat over the last month and are 1.3% higher than they were 12 months ago.

*Melbourne property prices increased 0.1% over the last week, fell -0.1% over the last month, and are -3.6% lower compared to 12 months ago.

*Brisbane property prices increased 0.1% over the last week, increased 0.2% over the last month and are 9.7% higher than they were 12 months ago.

Overall, Australian capital dwelling prices increased 0.1% over the last month and are now 3.5% higher than they were 12 months ago.

2,820 homes taken to auction across the combined capitals last week, the highest weekly volume of auctions held since the week ending December 1st last year.

The trend in clearance rates have also continued to rise, with the preliminary success rate coming in at 72.1% last week.

This current property cycle has been driven by an undersupply of good properties relative to current demand pushing up property values and rents there was nothing to suggest there will be any significant change in the near future.

Unfortunately, the undersupply properties is going to persist for some time with all commentators agreeing that there is no way we're going to hit the housing construction targets required to meet our demand.

The first interest rate cut in five years is welcome news for our housing markets.

Though modest, this rate cut is not just about the potential savings for homeowners; it's primarily a psychological boost that should reignite confidence in our housing market.

Even though the RBA warned that further interest rate cuts are not guaranteed this first cut signals to potential buyers that the market is stabilising, suggesting that now might be a safe time to invest in property.

The fear of being caught in rising interest rates after purchasing a home or investment property is significantly reduced, which should encourage more Australians to buy.

However, the benefits from the rate cut will not be distributed equally.

High-income earners with significant equity in their properties are likely to feel more confident in re-entering the property market than Aussie battlers who have been hurt by the cost of living crisis and who are unlikely to notice a significant change in their budget with this 0.25% cut in their mortgage rates.

Historically, when interest rates fall, buyers who have been sitting on the sidelines are enticed back into the market and property values start to increase as buyer confidence increases before seller confidence, making these new home buyers compete for the limited stock of properties available.

Traditionally, the premium suburbs in Sydney and Melbourne have led the market in price rebounds after interest rate cuts.

This time around it is likely that the 0.25% interest rate cut will stabilise house prices in Melbourne and Sydney, which have been falling over the last few months, rather than igniting the next phase of the property cycle.

On the auction front... 2,820 homes taken to auction across the combined capitals last week, the highest weekly volume of auctions held since the week ending December 1st last year.

The trend in clearance rates have also continued to rise, with the preliminary success rate coming in at 72.1% last week.

According to CoreLogic, combined capital city preliminary clearance rate holds above 70%

See Corelogic's full auction report below.

This week, CoreLogic also reports that:

Sydney property prices increased 0.2% over the last week, remained flat over the last month and are 1.3% higher than they were 12 months ago.
Melbourne property prices increased 0.1% over the last week, fell -0.1% over the last month, and are -3.6% lower compared to 12 months ago.

Brisbane property prices increased 0.1% over the last week, increased 0.2% over the last month and are 9.7% higher than they were 12 months ago.

Overall, Australian capital dwelling prices increased 0.1% over the last month and are now 3.5% higher than they were 12 months ago.

Clearly, the property cycle is moving on but our markets are very fragmented.

Source: CoreLogic February 24th 2025

Of course, these are "overall" figures - there is not one Sydney or Melbourne or Brisbane property market.

And various segments of each market are performing differently.

At the beginning of this cycle the upper quartile of the market lead the upswing but last year the lower quartile across every capital city recorded a stronger outcome for housing values relative to its upper quartile counterpart.

The following chart shows how various segments of each capital city market are performing differently with median-priced properties performing well.

To help keep you up-to-date with all that's happening in property, here is my updated weekly analysis of data and charts as of 24th February 2025 provided by SQM Research, CoreLogic, and realestate.com.au.

Current property asking prices

Property asking prices are a useful leading indicator for housing markets - giving a good indication of what's ahead.

Here is the latest data available:

Sydney

Property type	Price ($)	Weekly Change	Monthly Change %	Annual % change
All Houses	1,975,191	5.209	0.2%	2.8%
All Units	833,848	0.147	-1.6%	5.0%
Combined	1,511,813	3.154	-0.3%	3.0%

Source: SQM Research

Melbourne

Property type	Price ($)	Weekly Change	Monthly Change %	Annual % change
All Houses	1,249,433	-0.433	-0.7%	1.2%
All Units	614,048	-0.028	-0.1%	2.6%
Combined	1,049,259	-0.305	-0.6%	1.2%

Source: SQM Research

Brisbane

Property type	Price ($)	Weekly Change	Monthly Change %	Annual % change
All Houses	1,192,163	0.444	-0.8%	14.5%
All Units	685,637	4.963	1.3%	18.7%
Combined	1,065,228	1.576	-0.5%	15.0%

Source: SQM Research

Perth

Property type	Price ($)	Weekly Change	Monthly Change %	Annual % change
All Houses	1,104,631	-1.527	0.3%	17.7%
All Units	608,186	3.699	1.4%	26.0%
Combined	974,760	-0.160	0.5%	18.9%

Source: SQM Research

Adelaide

Property type	Price ($)	Weekly Change	Monthly Change %	Annual % change
All Houses	997,428	-2.217	1.9%	15.5%
All Units	530,419	0.581	1.4%	21.2%
Combined	913,505	-1.714	1.8%	16.0%

Source: SQM Research

Canberra

Property type	Price ($)	Weekly Change	Monthly Change %	Annual % change
All Houses	1,192,304	1.321	-1.2%	-0.7%
All Units	599,770	2.355	1.0%	-0.5%
Combined	973,172	1.704	-0.8%	-1.2%

Source: SQM Research

Darwin

Property type	Price ($)	Weekly Change	Monthly Change %	Annual % change
All Houses	721,932	-1.132	1.1%	8.9%
All Units	404,446	-3.446	-1.0%	7.7%
Combined	597,312	-2.040	0.5%	8.5%

Source: SQM Research

Hobart

Property type	Price ($)	Weekly Change	Monthly Change %	Annual % change
All Houses	810,861	0.866	0.4%	1.8%
All Units	502,940	-1.640	-0.7%	-1.3%
Combined	764,116	0.486	0.3%	1.4%

Source: SQM Research

National

Property type	Price ($)	Weekly Change	Monthly Change %	Annual % change
All Houses	962,531	-0.685	-0.3%	7.4%
All Units	573,405	1.734	0.3%	7.7%
Combined	878,630	-0.163	-0.2%	7.3%

Source: SQM Research

Cap City Average

Property type	Price ($)	Weekly Change	Monthly Change %	Annual % change
All Houses	1,425,996	3.411	-0.2%	5.8%
All Units	713,898	4.038	-0.6%	7.5%
Combined	1,214,668	3.597	-0.3%	5.8%

Source: SQM Research

The value of property asking prices as a leading indicator for housing markets is quite significant.

In fact it's more valuable than median prices which can be quite misleading.

Let's delve into why this is the case and how it impacts the real estate market.

Early Market Sentiment Indicator: Asking prices often reflect the current sentiment of sellers in the real estate market.

If sellers are confident, they might set higher asking prices, anticipating strong demand.
Conversely, if sellers are uncertain or perceive a market downturn, they might lower their asking prices to attract buyers.
This makes asking prices a real-time indicator of market sentiment, often preceding changes in actual sales prices.
Predictive of Future Price Trends: Trends in asking prices can be predictive of where the actual property prices are headed.
For example, a consistent rise in asking prices over a period can signal an upcoming rise in transaction prices.
Impact of Economic Factors: Economic factors such as interest rates, employment rates, and broader economic health influence asking prices.
For instance, changes in the Reserve Bank of Australia's policies or shifts in the job market can quickly reflect in the asking prices, providing insights into how these factors are influencing the housing market.
Regional Variations: In a diverse market like Australia's, asking prices can also provide insights into regional disparities.
For instance, the property markets in Melbourne and Sydney might behave differently from those in Brisbane or Perth. Asking prices can give early indications of these regional trends.
Influence of Supply and Demand: Asking prices are also a response to the balance of supply and demand in the market.
In areas with limited supply and high demand, asking prices tend to be higher and vice versa.

However, it's important to note that while asking prices are a valuable indicator, they should not be used in isolation.

Other factors like actual sales prices, time on the market, auction clearance rates, and economic conditions also play crucial roles in understanding the property market dynamics.

Last weekend's auction report

Combined capital city preliminary clearance rate holds above 70%

There were 2,820 homes taken to auction across the combined capitals last week, the highest weekly volume of auctions held since the week ending December 1st last year.

Alongside the lift in auction volume, the trend in clearance rates has also continued to rise, with the preliminary success rate coming in at 72.1% last week, up from 71.2% the previous week (revised down to 63.8% on final numbers) and the second week running where the preliminary clearance rate has come in above the 70% mark.

This was the highest preliminary clearance rate since the last week of July 2024 (72.2%).

Melbourne recorded the most auctions, with 1,467 homes going under the hammer last week – the highest weekly volume since the last week of October 2024.

72.1% of auctions have been reported as successful so far, up from 70.7% the previous week (revised back to 63.7% on final numbers).

This is the highest preliminary clearance rate Melbourne has seen since the week ending July 14th last year.

959 homes went under the hammer in Sydney last week, the highest volume since the week ending December 1st last year.

Despite holding above the 70% mark for the third consecutive week, last week’s early success rate eased to 74.4%, down from 76.6% a week earlier (revised down to 67.2% once finalised).

Across the smaller auction markets, Adelaide hosted the most auctions at 151, with 71.6% reported as successful so far - the highest since the last week of January earlier this year.

138 homes were taken to auction in Brisbane, with the city recording the lowest preliminary clearance rate of any capital at 53.1%.

88 homes were taken to auction in Canberra with a 70.7% preliminary clearance rate which is the highest rate since the week ending October 13th last year.

The volume of auctions is set to reduce a little this week, with approximately 2,540 auctions currently scheduled across the combined capitals.

Our rental markets

Rental growth bounced slightly higher in January, up 0.4% over the month.

This follows a subdued second half of 2024 where the national rental index rose just 0.4% between June and December.

Every capital recorded a subtle rise in rents over the month, however the trend is clearly pointing to an ongoing easing in rental price growth (not a decrease in rents - they're just not growing as much.).

On an annual basis, Australian rents were up 4.4%, which is still more than double the pre-COVID decade average of
2.0% annual growth.

However, with rental growth slowing more visibly through the second half of last year, the annual change in rents is likely to fall to below-average levels in the first half of 2025.