The first quarter of this year was characterised by diverse market conditions around the nation, according to the latest PIPA National Market Update.

This report pulls together insights and analysis from market experts and PIPA members from the latest edition of the PIPA Adviser e-magazine’s national market update.

PIPA Chair Nicola McDougall said the NSW property market is showing signs of recovery, buoyed by the recent interest rate cut, steadier property values, and growing confidence among buyers.

“The property market in Victoria is showing specific pockets of opportunities despite challenges like policy uncertainties,” Ms McDougall said.

“Melbourne is particularly attractive due to affordable housing options, with increasing demand for well-located units in areas like Carlton.”

Queensland’s real estate market remains strong, though the pace of growth has slowed, she said.

“Regional areas like Mackay and Townsville lead with significant increases, while Brisbane sustains positive growth trends, especially in units and townhouses,” Ms McDougall said.

“Population growth, limited housing supply, and rising construction costs continue to drive demand.

“Meanwhile, Adelaide remains a key market for investors due to its affordability, diverse property options, and robust economic growth fuelled by large-scale projects like the AUKUS submarine initiative.”

Ms McDougall said Perth’s property market continues to perform well, achieving the highest annual growth among Australian capitals.

“Despite moderating growth, limited supply, high rental yields, and affordability compared to other states ensure sustained demand in this market,” she said.

“Canberra’s market shows early signs of balance as it adjusts to economic shifts. Investors may face regulatory challenges, yet, steady demand and strong job security underpin a positive outlook for the property market.

“Tasmania’s property market is experiencing a recovery, with increased sales activity and infrastructure investments driving confidence. However, the state’s rental market faces affordability challenges, necessitating policy action to address the widening gap between supply and demand.”

NEW SOUTH WALES

Rich Harvey, CEO & Founder, PropertyBuyer

“The NSW property market has entered 2025 with cautious optimism, supported by a modest interest rate cut, stabilising values, and improving buyer sentiment.

“While market dynamics remain nuanced, especially across different price points and regions, data from CoreLogic suggests a gentle rebound is under way after a flat end to 2024.

“My team of buyers’ agents are reporting a “patchy” market with A-grade properties being highly sought after while other auctions lacklustre.

“Sydney dwelling values recorded a minor quarterly decline of -0.9 per cent to February 2025. On an annual basis, however, values are still up 1.1 per cent, with February seeing a slight monthly rise of 0.3 per cent. While prices remain 1.6 per cent below their September 2024 peak, the recent upward tick – particularly in the upper quartile segment – signals renewed buyer confidence in higher-value markets.

“Auction activity has rebounded after a slow January, with Sydney posting a strong preliminary clearance rate of 81.7 per cent in mid-February – the highest since late 2021. Across the combined capitals, clearance rates have averaged 63.7 per cent over the past four weeks, just shy of the long-term average of 64.6 per cent. This is a clear sign that buyers are stepping back in, particularly where stock is scarce.

“The flow of new listings in Sydney was up 3.1 per cent compared to the same time last year, though still below the five-year average. Total listings remain low by historical standards, down 10.5 per cent nationally compared to the five-year norm. This constrained supply has helped underpin prices, despite the broader economic uncertainty.

“The median vendor discount in Sydney has eased slightly to -3.5 per cent, reflecting improved buyer engagement and fewer distressed sales. However, properties are taking longer to sell, with the median days on market increasing to 37 days, up from 27 days a year ago.

“Sentiment has improved following the RBA’s February rate cut from 4.35 per cent to 4.10 per cent. Although cautious rhetoric remains around future cuts, the decision provided immediate relief to mortgage holders and a psychological boost to buyers waiting for a more accommodative lending environment.

“Sydney’s rental market remains tight, with annual rent growth at 2.6 per cent. Gross rental yields remain subdued at 3.1 per cent, but ongoing demand, driven by population growth and limited rental stock, is keeping vacancy rates low and investor interest stable.

“Looking ahead, the NSW market is likely to experience modest growth in the second quarter, especially if further rate relief materialises. Tight supply, steady buyer interest, and stabilising borrowing costs should support values through 2025, particularly in established, high-demand areas.”

VICTORIA

By Terry Ryder, Director, Hotspotting

“Generally, we see Melbourne and Regional Victoria as an opportunity to buy well, for those who can disregard the negatives from the State Government.

“Across the State, we anticipate solid market conditions in the City of Melbourne for units as well as houses in the City of Casey, the City of Ballarat, as well as Albury/Wodonga.

“Melbourne’s potential, especially in metro and south-east areas, is due to the affordability of units and houses respectively.

“Demand for well-located attached dwellings in Melbourne is rising, driving rent growth, price increases, and new dwelling approvals.

“The City of Casey continues to be a strong market with steady long-term growth and appeal for first-home buyers.

“Units in Hampton offers an affordable alternative to beachside Brighton and is popular with families due to its parks, playgrounds and sporting amenities.

Hampton’s vibrant shopping strip and beach-friendly environment also make it an ideal location for outdoor activities and family life.

“Langwarrin appeal to families given its proximity to top schools and recreational areas.

“Langwarrin also offers a semi-rural feel with easy access to Frankston Beach and the Melbourne CBD.

“Units in Carlton are also offering strong yields for investors.

“Carlton is close to the University of Melbourne, the CBD campus of RMIT University and the Fitzroy campus of Australian Catholic University and has one of the highest concentrations of university students in Australia.

“As a result, the rental market is busy. According to ABS figures, almost 73 per cent of residents are renters and almost 18 per cent of properties are group households with 81 per cent of dwellings are apartments.

“A number of new apartment developments are planned or under way in the suburb. While much of the Greater Melbourne market is lukewarm, Carlton’s unit market is achieving consistent transaction levels.

“In regional Victoria, Merebein is popular with retirees, tree-changers and first-home buyers and is the main service centre of the Sunraysia region.

“Strong population growth in recent years has also prompted significant residential development.

“Likewise, the region forms the northern end of the Murray River Renewable Energy Zone, which is attracting billions of investment dollars and creating hundreds of local jobs through wind, solar and battery projects.

“Low vacancy rates and strong yields make it increasingly worthy of investor consideration.”

QUEENSLAND

Andy Adams, QPIA & Buyers Agent, Streamline Property Buyers

“Queensland’s real estate market continues to grow steadily, albeit at a slower pace in the first quarter of 2025.

“According to CoreLogic, some regional areas in Queensland have stood out as top performers, surpassing many other regional markets across Australia.

“Mackay saw a strong increase of 5.7 per cent, Townsville rose by 5.1 per cent, and Gladstone experienced 4.3 per cent growth over the past three months.

“Despite these standout performances, CoreLogic reports that 10 out of 11 Queensland markets have shown signs of softened growth over the past quarter.

Brisbane’s property market maintained positive quarterly growth momentum, recording a 0.9 per cent increase by the end of February.

“While this is a slight dip from the previous quarter’s 1.2 per cent growth, Brisbane continues to rank as one of Australia’s strongest-performing capital city markets, with dwelling values rising 9.7 per cent over the past year.

“Units and townhouses in Brisbane are outperforming standalone houses in terms of growth. These attached dwellings saw two per cent increase in the quarter ending in February and an impressive 15.2 per cent annual rise.  

“In comparison, Brisbane houses saw a 0.7 per cent quarterly growth rate and an 8.6 per cent annual increase. This strong unit market performance is largely driven by affordability and limited supply.
“With construction costs remaining high and building timelines extended, developers are hesitant to build lower-end units and townhouses, further restricting supply and increasing demand for these property types.

“Brisbane’s rental market remains extremely tight, with vacancy rates dropping to just 0.8 per cent in February.

“As rents continue to rise, albeit at a slower annual pace, many renters seeking to find accommodation throughout the city are turning to units and townhouses as more affordable options. However, the limited stock is fuelling competition and pushing demand higher.

“Queensland’s population growth continues to exceed the national average, increasing by 2.3 per cent in the 12 months leading up to June 2024. This growth is driven by natural population increases and strong interstate migration, adding further pressure to the property market.

“Brisbane’s economy continues to benefit from major infrastructure projects like Brisbane Metro, Cross River Rail, and Queen’s Wharf, which are boosting jobs and local investment.

“The upcoming 2032 Olympics is also set to drive long-term infrastructure spending, strengthening Brisbane’s economy and property market outlook.

“According to SQM Research, property listings remain well below the long-term average across many regions in Queensland, including Brisbane. With fewer properties available, competition among buyers has increased, further driving demand.

“In positive news for borrowers, the Reserve Bank recently cut interest rates for the first time in four years. With most major banks passing these savings on, buyers now have improved borrowing power, which could encourage more competitive offers in the market.

“Queensland’s property market outlook remains strong, while population growth, infrastructure investments, and a recent interest rate cut are driving competition in an already tight market.”

SOUTH AUSTRALIA

Dr. Kevin Hoang, Senior Economist, Head of Property Research, inSynergy Advisory

“The property market in Adelaide has attracted significant attention from both local and interstate investors, thanks to the city’s affordability and future growth potential.

“Adelaide is consistently among the top performing cities in Australia for capital growth in recent years. In the 12 months to February 2025, median house prices increased by 12 per cent. House prices have surged by 75 per cent over the past five years, making it the second-best performer after Perth.

“Not only has the affordable segment performed well, but multimillion-dollar property transactions have also become increasingly common in Adelaide, highlighting the city’s growing appeal to high-net-worth investors and individuals.

“Known as the ‘20-minute city’, meaning that the beaches, hills, CBD, and major attractions are all within easy reach, Adelaide offers a diverse range of property types, from homes with period character in North Adelaide to large lots in suburban areas, apartment buildings in the city and modern developments on the city fringes.

“This variety appeals to a broad range of buyers, including families, young professionals and investors.

“Moreover, the strong rental market in Adelaide has drawn investors seeking high returns. With a rising population, rental demand has remained robust over the years, resulting in a remarkably low vacancy rate of just 0.7 per cent, well below a balanced market range of two to three per cent.

“One of the fundamental pillars of the Adelaide property market is its economic dynamism. The South Australian Government has set bold plans that aim to develop and diversify its economy, particularly in high-tech industries such as space, digital technology, manufacturing and defence.

“At the top of the list is the AUKUS nuclear-powered submarines project, valued at $400 billion over the next 30 years. This is the largest defence project in Australia’s history and is expected to create 20,000 direct jobs, along with tens of thousands of indirect jobs across the broader economy in Adelaide and beyond.

“To put the AUKUS project spending in context, the Queensland Government will invest approximately $23 billion in infrastructure projects for the 2032 Olympics. In comparison, Adelaide’s nearly $400 billion investment in this project is almost 20 times greater.

“With Adelaide’s population about half that of Brisbane, the per capita spending is even more substantial, which is expected to drive significant upward pressure on property values and rental yields across the city.

“Furthermore, the SA Government and the private sector have committed substantial investment worth billions of dollars for innovation and technology, including the Lot Fourteen Tech Hub, the Australian Space Agency, and the Deloitte Australian Centre for Innovation and Technology. Currently, Lot Fourteen is home to over 100 established tech firms and 60 startups, including global technology giants like Amazon and Google.

“Beyond their economic impact, large infrastructure projects will have a lasting effect on Adelaide’s housing market, requiring tens of thousands of new dwellings to accommodate the growing workforce and population.

“In conclusion, Adelaide is a unique place for astute investors, offering strong economic fundamentals, diverse property options, robust rental demand, and, most importantly, a new era of economic prosperity.”

WESTERN AUSTRALIA

By Matthew Hughes, Managing Director, Capital Property Advisory

“Perth’s property market has continued its upward trajectory, albeit at a moderating pace – as was to be expected after leading the country in price growth for over the past five years, edging out Adelaide and Brisbane slightly with a 75.9 per cent jump in values over this period.

“Despite this record growth, WA remains more affordable than all other States (excluding Territories) with the proportion of family income required to meet loan repayments increasing 2.5 percentage points over the most recent quarter to 42.5 per cent – compared with 47 per cent in Victoria, 49.6 per cent in Queensland and 59.9 per cent in New South Wales.

“According to CoreLogic’s latest Home Value Index, Perth recorded a 0.3 per cent lift in dwelling values over February and a robust 14.3 per cent increase over the past 12 months – the highest annual growth of any capital city over this period. The median dwelling value now sits at $807,933, while median house values have risen to $840,400.

“Although growth has moderated from the rapid pace seen in recent years, demand remains strong and supply very tight, with transactions levels still at high levels and only around 5000 property listings available for sale according to REIWA – 28 per cent lower, compared to the five-year average.

“The market is transitioning from boom conditions to more sustainable growth, a trend that reflects improved buyer sentiment driven by slightly higher stock levels and expectations of further interest rate cuts, rather than any marked improvement in borrowing power to this point.

“This persistent shortage of available established homes continues to underpin prices, particularly in well-located, affordable suburbs.

“Rental pressures remain high. Perth leads the country with an 8.4 per cent annual increase in house rents and gross rental yields of 6.4 per cent – well above the national average of 3.7 per cent.

“Vacancy rates continue to hover around one per cent – depending on your source of data, with little relief in sight – while the appetite for new construction has returned, this may be short-lived, as supply struggles to meet demand due to labour shortages impacting costs and timeframes for construction.

“Investor activity from the eastern states has tempered, likely a result of rising entry prices and the resulting softening in yields; however, local buyers are still active, with many moving quickly to secure quality assets in high-demand areas.

“While Perth’s pace of growth has eased, the outlook remains positive. Limited supply, strong rental yields, and a relatively affordable entry point compared to the eastern capitals continue to attract both investors and owner-occupiers.

“With interest rates expected to continue easing throughout 2025, we anticipate a return to more balanced, yet still positive, conditions throughout this year and into next.”

ACT

By Brady Yoshia, Founder & CEO, Brady Marcs Buyers Advisory

“The ACT property market shows stability after a subdued 2024, with early signs of balance for buyers and sellers. Modest auction clearance rates indicate a market adjusting to economic shifts.

“Affordability challenges, interest rate uncertainty from a recent cut, and increased housing supply influence conditions. However, buyer confidence is rising, especially in mid-tier properties, while high-quality homes in sought-after suburbs attract strong interest.

“More buyers have entered the market, but affordability is still a concern. A recent rate cut provided some relief, yet uncertainty about future interest rates continues to influence sentiment.

“Increased supply offers more choices, especially for mid-range buyers. However, overpriced or poorly presented properties struggle to attract interest, emphasising the need for realistic pricing and strategy marketing.

“Investors benefiting from recent price growth have sold, increasing market stock. This has created buyer opportunities, although demand varies by property type.

“Well-located homes in high-demand areas are selling quickly, while oversupply in some segments has softened demand. Apartments and investment properties in less central areas are slower to sell as buyers prefer houses and townhouses for more space and a better lifestyle appeal.

“According to CoreLogic, Canberra’s median dwelling values have dipped slightly in 2024, but early indicators for 2025 suggest that prices are stabilising rather than continuing to decline.

“Vacancy rates, which have risen due to an increase in supply, are beginning to tighten again, indicating that rental demand remains strong.

“Canberra’s employment base continues to support the market, with job security remaining strong due to the city’s role as Australia’s public service hub. Population growth also plays a significant role, particularly through migration and the education sector, contributing to steady demand for housing.

“While rental demand remains robust, investors are encountering ongoing challenges due to new regulations.

“By 2025, additional rental laws will introduce further compliance requirements, including the necessity for a Section 119 Certificate prior to leasing. These changes follow earlier regulations, such as mandatory insulation upgrades and restrictions on no-cause evictions, which solidify Canberra’s reputation as one of the most stringently regulated rental markets.

“The ACT State Election in late 2024 confirmed expectations that these regulations will persist, with the Labor Government likely to introduce additional policies affecting landlords.

“The Canberra property market remains balanced, offering opportunities for those who are well-prepared. Investors who adapt to regulatory changes need to be strategic, while buyers benefit from greater choice.

“Sellers who price their properties competitively and present them attractively continue to achieve strong results. With solid employment levels, population growth, and sustained demand underpinning the market, there are positive signs for the year ahead.”

TASMANIA

Samantha Spilsbury, Director, Buyers Agents Tasmania

“The Tasmanian market is starting 2025 strong, experiencing significant growth and transformation, driven by both economic dynamics and large-scale infrastructure projects.

“The Real Estate Institute of Tasmania’s quarterly report for December 2024 highlights a robust recovery in the state’s property market compared to 2023, with transaction volumes exceeding expectations. The cumulative value of sales reached its second-highest level on record, reflecting strong market confidence. 

In 2024, Tasmania saw a significant increase in total sales, with 976 more transactions than the previous year (11.1 per cent growth).

“First-time homebuyers, investors, and mainland buyers were particularly active throughout 2024, eager to enter the market before its full rebound. Despite external economic challenges such as rising living costs, slowing population growth, and high interest rates, the market displayed remarkable resilience.

“While median prices held steady over the past 12 months, growing buyer demand is expected to place upward pressure on prices in the coming year. Despite a slight dip in sales during the December 2024 quarter compared to the September quarter, performance remained notably stronger than the same period in 2023.

“The rental market continues to face intense competition, with the vacancy rate reaching a historic low of just 0.82 per cent – one of the lowest in Australia. This scarcity of available rental properties has resulted in increased rental prices, further exacerbating the affordability challenge.

“The rental market remains under strain, with affordability at its lowest point since 2008. Currently, only 36 per cent of advertised rental properties are affordable for middle-income households, and just two per cent are affordable for lower-income households.

“This disparity is exacerbated by a 48 per cent surge in rental prices since the pandemic, making it increasingly difficult for many to secure suitable housing.

Tasmania is undergoing transformative developments, with the State Government committing over $284 million to crucial land transport projects. Among these is the significant upgrade to the Lyell Highway between Granton and New Norfolk, which aims to improve road safety and enhance travel efficiency.

“Tasmania’s infrastructure pipeline is set to surpass $30 billion in investments over the next decade, driving job creation and stimulating economic activity. These developments are expected to have a positive impact on both the property sales and rental markets.

“As we look to 2025, Tasmania’s property market faces a delicate balance. While significant infrastructure projects provide a strong foundation for future growth, addressing the rental affordability crisis will require swift and strategic policy action.

“With careful planning and targeted interventions, Tasmania can continue to thrive as a sought-after destination for property buyers and renters alike.”

ENDS

Bricks & Mortar Media | media@bricksandmortarmedia.com.au