Australian Property Market: Growth Gathers Steam
June 2: Rate Cuts 'Fuelling' Property Prices
Property prices continue to rise across Australian capital cities, with home values increasing by 0.5% in May.
According to Cotality’s Home Value Index, prices are 1.7% higher since the start of 2025. Last month’s gains were felt across all capital cities, with Darwin leading the charge at 1.6% followed by Perth at 0.7%. Sydney and Melbourne rose by 0.5% and 0.4% respectively. Regional markets are also lifting, recording a 0.4% rise in May.
Cotality’s research director, Tim Lawless, said the uptick in values was largely due to the RBA’s cash rate movements.
“The continued momentum we’re seeing across almost all markets is no doubt being fuelled by rate cuts—both those that have already happened, but also potential cuts in the coming months,” he said.
The data comes as Demographia’s annual International Housing Affordability report for 2025 revealed that Sydney is home to the second-most expensive property in the world, behind Hong Kong.
In fact, Demographia labelled four Aussie cities—Sydney, Adelaide, Brisbane, and Melbourne – as “impossibly unaffordable”, with home prices in each of these cities nine times or greater than the median wage.
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