House prices have continued to rise throughout the country in the midst of interest rates and expectations that as more buyers return to the market, real estate values will rise.
Property analysts think that the combined home race of Capital City could increase between 6 percent to 10 percent at the end of this year or early next year.
Data from Cotality (formerly Corelogic) shows that house prices were higher in May.
The National Home Value Index registered another 0.5 percent in May, with the National Index 1.7 percent higher in the first five months of the year.
The profits were wide, with each capital achieving an increase of at least 0.4 percent to the month.
The research by Cotality, Eliza Owen, says that house prices are being fueled by interest rates – both that have already happened, but also potential cuts in the coming months.
“At the moment, two tariff reductions are expected by most large banks in the course of the year, and the influence on the market is probably higher values and higher sales activity.
“I think 6 percent to 10 percent (rise in house prices) is a possibility early next year, but I would probably say it at the bottom of that reach,”
Said Owen.
“Yes, you get a boost to loan capacity of lower interest rates, but that still brings an affordable purchase price for many households that are much lower than where real estate prices are actually, especially when you consider the median house value in the combined capitals, is now more than $ 1,000,000.
“And I think other factors such as rising unemployment, the softer wages growth can also give a lid on that growth rate.”
Eliza Owen from Cotality does not expect house prices to increase more than 10 percent in the coming 12 months as affordability restrictions struck. ((ABC News: John Gunn))
Mrs Owen said, behind the back of the work policy aimed at helping the first time buyers, there could also be a further increase in copper sentiment.
She noted that although the extensive 5 percent deposit guarantee of the government will ‘go live’ only next year, some buyers from the first house may want to come on the market this year to beat the electricity of buyers that expects next year.
“At the end of the day, where you have the policy of demand that encourages more people to buy and give great access to home financing while your offer is limited, the prices will push higher,” “
she said.
Why house prices will rise
The research head of SQM Louis Christopher said that he also expects more tariff reductions and house prices to rise in the midst of more the buyer’s demand and a tight supply of housing.
The real estate research agency predicts an increase in Capital City combined house prices from 6 percent to 10 percent next year.
Louis Christopher, managing director of SQM Research, expects house prices throughout the country to be able to increase by 10 percent. ((ABC News: John Gunn))
Mr. Christopher said that the RBA would lower the cash target rate during the next board meeting, planned for 8 July by a further 0.25 percent, but it could reduce with no less than 50 basic points “if there are further mitigating signs such as a weak GDP growth and/or a weakening Banmarkt”.
He said that this will exert the pressure on prices from the start of the quarter of September.
He expects the housing values per capital city by next year: Sydney +3 percent to +7 percent, Melbourne +2 percent to +6 percent, Brisbane +11 percent to +16 percent, PerTH +15 percent to +20 percent, Adelaide +10 percent to +14 percent, Hobart +1 percent, Canberra +2 per press.
He noted that in very recent weeks SQM research has set a reinforcement of the auction percentages and a higher volume activity.
“This indicates that the housing market is currently and is taking more home buyers on the market,”
Said Mr. Christopher.
“Other factors that contribute to this current increase in the buyer’s demand are the end of the federal elections and the constant increase in the underlying demand for accommodation given our continuous rising population growth.
“This, combined with continuous low levels of home, all feeds the conditions for storage increases in house prices.”
He said that although the federal government has also committed itself to build new houses to stimulate the supply, the target of 1.2 million homes completed by FY29 “is very likely to be missed by an estimate of between 250,000 and 400,000 homes”, which would mean that it is to be relatively weak for some time.
Gino Farina is the founder of MortGage Broking Business Bondi Broker based in Sydney, but services customers throughout the country.
He says that the cutbacks are already being charged with decisions from buyers and that another two cutbacks are expected this year, more people will be able to get a housing loan.
He thinks that the demand for housing and therefore prices could further increase.
“It does increase the loan capacity of people … that helps more confidence,” he said.
“We see a mix [of buyers]. We still see the first buyers of home … and we [help them] Use a lot of the government programs to help those people get to the market.
“Investors are still there, but it is clearly more challenging for investors, and also for people who want to upgrade.
“What found now is that buyers re -tailor their expectations to what they can afford.”
Mortgage broker Gino Farina says he sees more interest in the buyers of the first house. ((ABC News: John Gunn))
Melbourne and Canberra Record annual decreases of house prices, but are on the way upwards
Mrs. Owen said that the monthly increase in the house price index values of COTIWITY comes after a brief decrease of only 0.4 percent during the three months ending on January 2025, with the interest rate that reduced a key factor to support the real estate price increases.
However, she noticed that the annual pace of profit in the National Index delayed to 3.3 percent, the slowest change of twelve months since the year ending in August 2023.
Only Melbourne (-1.2 percent) and Canberra (-0.7 percent) have registered an annual decrease in housing values.
Only Melbourne and Canberra have registered an annual decrease in housing values, but prices in both cities are rising again. ((ABC News: Peter Drought))
Trends of the Capital City home have been merged, with the gap between the highest and lowest annual changes that are reduced to 9.8 percentage points, and it has not been so narrow since March 2021.
“However, what is interesting in the capitals is that we see a little growth relationship,”
Said Owen.
“Markets such as Brisbane, Adelaide who really went very strong last year, have delayed your quarterly growth from about 1 to 1.5 percent.
“In the meantime, cities that saw more consistent falls, such as Melbourne and Canberra, are now in a positive area for the Sydney market, which are an increase of 1.1 percent every three -month increase.”
Regional markets also show a positive trend, in which each of the ‘rest of the state’ markets registers an increase in values to date to date.
The strongest records were in the regional South Australia, where the values rose by 3.8 percent during the first five months of 2025.
Softer growth on the rental market if Aussies turn to shared homes
Mrs. Owen said that the largest capitals, Sydney and Melbourne, are now one of the softest rental markets in the country after a period of extreme rental growth.
Despite the lease reports that remain in the vicinity of historic lows, the delay in rental growth comes.
Each capital city remains the rental reports of the rent of less than 2 percent compared to an average of a decade of 2.7 percent for the combined capitals.
“The rental market has grown by around 3 to 3.5 percent in the last 12 months and it is a delay in the pace of growth.
“That is a decrease of approximately 8 percent in the previous period of 12 months. We would expect that growth [in rental prices] Will continue to slow down, maybe we will get a stabilization.
“And you may now have more stock homes and multi -family homes that are formed in response to priceless rental costs and a delay in the net overseas migration.“
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