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 increased again over May as another monthly fall in RBA interest rates enhances rising affordability and confidence.
The national capital city median house price was up by 0.6% over the May quarter to $1,184,459 compared to the April quarter, according to the latest data from My Housing Market.
National house prices have now risen over three consecutive months and are 4.5% higher than recorded over May 2024.
All capitals reported house price increases over May, with Canberra the top performer up by 2.3,% followed by Hobart higher by 1.1%, a resurgent Melbourne up again by 0.9%, Perth higher by 0.6%, Brisbane up 0.5%, Sydney increased 0.4% and Adelaide and Darwin each up 0.3%.
House prices have increased over the past year in Perth, Adelaide, Brisbane, Darwin, Sydney, Hobart, Canberra and Melbourne - higher by 11.2%, 10.3%, 8.2%, 4.6%, 3.8%, 2.0%, 0.4% and 0.1%.
|
Quarterly Median House Prices May 2025 |
||||||
| Median | Month | This Year | 1 Year | 2 Year | ||
| Sydney | $1,684,366 | 0.4% | 1.8% | 3.8% | 13.1% | |
| Melbourne | $1,071,195 | 0.9% | 2.0% | 0.1% | 2.3% | |
| Brisbane | $1,021,143 | 0.5% | 1.7% | 8.2% | 28.2% | |
| Adelaide | $1,001,985 | 0.3% | 2.8% | 10.3% | 28.1% | |
| Perth | $970,564 | 0.6% | 0.2% | 11.2% | 37.8% | |
| Hobart | $692,004 | 1.1% | 1.4% | 2.0% | 0.3% | |
| Darwin | $658,191 | 0.3% | 5.2% | 4.6% | 2.2% | |
| Canberra | $977,373 | 2.3% | 2.4% | 0.4% | 1.4% | |
| National | $1,184,459 | 0.6% | 1.7% | 4.5% | 14.7% | |
Apartment / unit prices
National unit prices were higher for the fourth consecutive month over the May quarter, rising by 0.6% to $677,033 and remained 3.9% higher than the May quarter 2024 result.
Perth was the top performer over May with unit prices rising by 1.2% followed by Sydney increasing 0.6%, Melbourne and Brisbane each higher by 0.5%, and Adelaide, Hobart and Darwin unit prices each up 0.2%.
Canberra unit price, however, fell 0.7% over the month.
| Quarterly Median Unit Prices May 2025 | ||||||
| Median | Month | This Year | 1 Year | 2 Year | ||
| Sydney | $788,755 | 0.6% | 1.6% | 2.7% | 8.0% | |
| Melbourne | $567,588 | 0.5% | 1.1% | -1.1% | 1.9% | |
| Brisbane | $611,325 | 0.5% | 6.4% | 15.6% | 47.1% | |
| Adelaide | $555,472 | 0.2% | 5.5% | 13.4% | 34.3% | |
| Perth | $536,226 | 1.2% | 4.6% | 14.7% | 40.4% | |
| Hobart | $579,665 | 0.2% | 11.6% | 20.3% | 15.0% | |
| Darwin | $395,925 | 0.2% | 10.8% | 13.7% | 5.1% | |
| Canberra | $498,294 | -0.7% | -0.5% | -3.8% | -0.9% | |
| National | $677,033 | 0.6% | 2.3% | 3.9% | 11.4% | |
Hobart, Brisbane, Perth, Darwin and Adelaide have clearly recorded the highest annual unit price growth over the year ending the May quarter 2025, up by 20.3%, 15.6%, 14.7%, 13.7% and 13.4% respectively.
Sydney annual unit prices are now higher by 2.7%, with the Melbourne annual unit price however,r down 1.1% and Canberra lower by 3.8%.
Comment
Capital city housing markets have continued to report generally positive results over the May quarter compared to the previous April quarter for both houses and units.
The May decision by the RBA to again cut official interest rates following the February reduction – the first cut in over 4 years- has enhanced already strengthening housing market activity by increasing buyer confidence and improving affordability.
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House price growth over May was particularly strong in Hobart and Canberra, with more encouraging results from Melbourne, which continues to exhibit signs of revival following recent subdued growth.
Although Perth again reported positive growth over the month, house prices remain modest over the year so far in sharp contrast to the spectacular growth recorded by that capital through 2023 and 2024.
Unit price growth also remains generally positive, although overall results were marginally down compared to houses over the month.
Melbourne again reported solid results over the month, with unit prices in that city now rising over four consecutive quarters for the first time since June 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 still further RBA rate cuts that will support housing market activity and typically generate higher home prices.
The national economy remains strong with continuing low jobless rates and strong jobs growth driving higher wage increases that will also 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 2003 and 2024, and have continued to rebound over May following a typically quieter start to 2025, reflecting early-year seasonal influences.
National home prices are set to record positive growth again over 2025 supported by lower interest rates, a continuing strong economy and chronically low levels of new home construction.
