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PropTrack has made its property price predictions for the 12 months ahead.
REA Group’s property data insights arm has crunched the numbers and delivered its forecast for price rises in 2025, predicting national growth to come in at or below 4 per cent for the year.
The result would mark a slowdown from years past. At the end of 2023, property prices were observed to have risen by 6.9 per cent, while the figures from 2024 are projected to come in at a 5.5 per cent increase.
REA Group’s director of economic research, Cameron Kusher, noted that across 2024, property market conditions are “far from uniform across the capitals and regions, with significant variations reflecting diverse supply and demand dynamics”.
That’s expected to be the case in 2025 as well, with the firm projecting some markets to continue running hot, while others to enter a decidedly cooler phase.
Home prices in Perth and Adelaide are projected to have the biggest year, with a forecast increase of up to 6 per cent in 2025. This will still represent a remarkable slowdown with the cities having risen 18.7 per cent and 14.6 per cent respectively over the year to November 2024.
After dropping 1.6 per cent in 2024, Melbourne is expected to post the weakest results in 2025, with an expected increase in median price of 1 per cent to 2 per cent.
Brisbane is expected to have a steep comedown in the new year. Following a 12.6 per cent rise over 2023, the Sunshine State capital is expected to see price growth of between 2 per cent to 5 per cent.
Sydney is also expecting moderate growth of 1 per cent to 4 per cent, after a 4.6 per cent increase in 2024.
The forecast for Hobart, Darwin and Canberra is a little more firm, with expected rises of up to 3 per cent in 2025. This will represent an increase for each of the cities, following modest gains in the year to November 2024 with growth of 2.3 per cent in Darwin, 1.3 per cent in Hobart, and 1 per cent in Canberra.
Kusher commented that the group has taken many lessons from 2024 in forming its 2025 forecast, noting how affordability pressures and fluctuating supply have largely defined the market this year.
“Australia’s property market has shown unexpected resilience in 2024, with home prices rising nationally despite varied performance across the country and an influx of new properties hitting the market.
“The increase in available stock has boosted sales volumes but also led to softening demand, which has been a contributing factor to slowing price growth. With more options, buyers face less urgency to purchase, and properties are spending a longer time on the market,” he said.
Looking ahead, Kusher remarked that the delay of an interest rate cut – with most major banks pushing their projections to May 2025 – will be a big factor for price growth in the year ahead.
ABOUT THE AUTHOR
Juliet Helmke
Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.
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