July 2025
Australia’s home values saw accelerated gains in the second quarter on the back of long-awaited interest rate cuts. Property observers foresee further gains in home prices driven by further RBA rate cuts, as well as housing support policies put in place at both national and local levels.
Home value growth gathers momentum
The Australian housing market extended its streak of price gains to a fifth consecutive month in June. Dwelling values lifted 0.6 per cent according to figures from Cotality, with monthly increases posted across every region of Australia, except Hobart which saw a 0.2% decline.
National home values rose 1.4% in the June quarter (Q2 2025), accelerating from a 0.9% increase in Q1 2025. This follows a 0.1% decline in Q4 2024.
PropTrack data indicates that national house prices hit a record high before the close of the last financial year, and are now on average $40,900 higher than they were a year previously, in a major affordability blow for first-time home buyers.
The two rate cuts posted by the Reserve Bank of Australia (RBA) in the first half of 2025 played a pivotal role in the recovery then acceleration of growth in nationwide housing prices.
Cotality’s research director, Tim Lawless, says the long-awaited moves from the RBA and its pivot towards a dovish monetary policy stance are an inflexion point for the performance of Australia’s housing market.
“The first rate cut in February was a clear turning point for housing value trends. An additional cut in May, and growing certainty of more cuts later in the year have further fuelled positive housing sentiment, pushing values higher,” Lawless said.
Lawless also pointed to low levels of advertised stock, tracking -5.8 percent below the same time a year ago.
More RBA cuts anticipated
Economists foresee further cuts from the RBA, as Australia grapples with the market uncertainty created by Trump’s mercurial tariff war and strife in the Middle East.
AMP chief economist Shane Oliver expects the RBA to cut interest rates by 25 basis points in July, August and November of this year, before cutting again in February 2026. The move will drag the cash rate down to 2.85 per cent, providing a boost to home prices.
REA senior economist Eleanor Creagh shares Oliver’s opinion, pointing to building market momentum as buyers anticipate another rate cut in July. Despite worsening affordability, Creagh expects further interest rate cuts in 2025 to provide further support to ongoing price growth with lower borrowing costs.
Rise in buyer demand to drive price growth
John Lindeman, CEO, Property Power Partners told CrowdProperty that these interest rate cuts in tandem with secular growth in demand and local support policies are on track to boost home values around Australia.
“The recent and further expected interest rate falls plus the Federal Government’s first home buyer initiatives are now combining with state government stamp duty concessions for first home buyers to increase the number of property buyers, as well as the amounts they can borrow,” Lindeman said.
“However, recent upticks in buyer demand are largely an expression of confidence, rather than the actual effects of interest rate cuts and government initiatives – although this will change in coming months.”
Rob Flux, educator and developer at the Property Developer Network, also foresees a mounting market recovery on the back of rate cuts and the government’s homebuyer support initiatives.
“We’re starting to see the market pick up all the way around the country, with interest rates dropping and early signs of more rate drops to come,” Flux said.
“With the federal government stipulating the five percent deposit for first home owners and other states giving home owner grants, we’re going to see more activity in terms of buyers coming back to the market.”
Lindeman sees variable trends in prices depending on the types of buyers attracted to different market locations.
“First home buyer markets will experience the biggest lift in demand, and prices are expected to rise in many of the lowest priced suburbs in our major cities,” he said.
“There will also be an increase in buyer demand for upgrader suburbs, but much of this will occur as recent first home buyers decide to upgrade, so the effect on prices will be less and take longer.”
Limited supply of new affordable apartments
The current limited supply of affordable housing in the market is significantly distorting pricing trends. Recent data from Ray White reveals a striking shift: units are now outperforming houses in Adelaide, Perth, and Brisbane, largely due to chronic undersupply.
Developers have increasingly focused on luxury projects aimed at downsizers, driven by rising land and construction costs. Unfortunately, this trend creates a cycle where affordable housing options dwindle, leading to heightened competition for the few existing units driving prices up.
At CrowdProperty, we recognise the urgency of this situation. We are dedicated to supporting developers in building more homes to help address this supply crisis. As David Ingram, CEO of CrowdProperty, emphasises, tackling this issue is essential for sustainable growth in the market.
CrowdProperty provides fast, simple and transparent property project finance for property professionals, learn more.
Opinions or views expressed represent the thoughts of individuals and not those of CrowdProperty or Cache.
June 2025
Home prices continued to rise around Australia in May, with all of the capital cities seeing gains.
Australia continues to fall short of housing development targets, which is set to provide a further boost to dwelling values over the medium and long-term.
Home values maintain growth momentum
Home values in Australia posted a 0.5% rise in May, bringing growth in Cotality’s National Index to 1.7% for the first five months of 2025.
Tim Lawless, Cotality research director, said that the Reserve Bank of Australia’s (RBA) rate cut helped to sustain the momentum in dwelling price gains around almost all of Australia.
All of the nation’s capital cities saw increases in home values of at least 0.4% last month.
Lawless said expectations of further rate cuts from the RBA will help to buoy Australian home prices until the end of 2025.
“With interest rates falling again in May, we are likely to see a further positive influence flowing through to housing values in June and through the rest of the year.”
Trump’s tariffs create cost uncertainty
While inflation in Australia has eased to within the RBA’s target range, its future course remains uncertain as a result of the turmoil caused by the Trump administration’s so-called ‘Liberation Day’ tariffs.
The tariffs could have an ambivalent impact on construction costs in Australia. While they could push costs higher by disrupting supply chains, they could also increase supply by impeding China’s exports to the huge US market, forcing manufacturers to search for alternatives.
AltusGroup reports that material prices already offer a mixed outlook. Steel and copper prices have trended lower, although energy-intensive materials such as brick and concrete remain expensive.
In the first quarter of 2025, prices for building materials used in residential construction recorded the first quarterly price decrease since the March 2012 quarter, driven by tepid demand in the eastern state of NSW and Victoria.
AltusGroup’s report also highlights Australia’s scarce supply of skilled construction labour as another important cost factor, given the upward pressure it’s putting on wages.
Dip in housing approvals led by NSW and Victoria
Australia appears to be lagging further behind national cabinet’s ambitious goals for the creation of 1.2 million well-located homes by the middle of 2029.
ABS data points to a drop in approvals across Australia of -5.7%. Declines were led by the two most populous states of NSW (-7.8%) and Victoria (-6.5%).
This leaves approvals well beneath the housing accord targets despite an overall upward trend.
Tom Forrest, CEO of Urban Taskforce Australia, said the data should come as a wake up call for the recently re-elected Albanese government.
“While there is clear improvement with 182,000 new homes approved in the last 12 months, that remains a long way behind the completion of 240,000 homes in every 12 month period of the Housing According,” Forrest said in an official statement.
“There is much more to be done on housing supply before the housing crisis is eased.”
Interest rates trending down could stimulate development activity
CrowdProperty head of operations Lisa Digby said the trend of declining interest rates is expected to stimulate increased activity in the housing market.
“With borrowing becoming more affordable, we anticipate a rise in lending approvals, whether from first-time buyers, investors, or those looking to upgrade,” Digby said.
“This uptick in demand bodes well for developers, particularly when that translates to increased market transactions.”
A lower interest rate environment will also likely see project feasibilities improve. While many developers have been cautious — sitting on the sidelines due to economic uncertainties and the elevated costs associated — there’s still a clear shift towards smaller-scale developments.
“We’re seeing small to medium projects in detached and attached housing and land subdivisions gaining momentum,” Digby said.
“Our increase in recent application volumes supports this trend, showcasing a diverse mix of projects across capital cities and regional centres.”
With the post-election period now behind us, property players are moving forward — acquiring sites, securing finance, and pushing ahead with construction. Overall, the landscape is turning more positive, signaling renewed confidence.
Inadequate supply good news for developers
John Lindeman, CEO, Property Power Partners, points out that even if the National Housing Accord’s target were met, it would still be insufficient to satisfy Australia’s mounting demand for housing.
Australia falling short of the target means the supply-demand imbalance on the housing market will be even more out-of-whack in future.
“The actual rate of completions is falling, and PropTrack forecasts that this trend will continue,” Lindeman said.
“Based on these trends, we will only be meeting around half of the demand for housing expected from population growth over the next five years.”
While this is bad news for home affordability, it’s likely to be a boon for developers who can reap higher home prices — especially amidst a cycle of interest rate cuts.
“As interest rates continue to fall, buyer demand from both investors and owner-occupiers is certain to dramatically increase, especially in the inner suburban areas of our major cities,” Lindeman said.
“This is good news for developers, as more buyers compete for fewer properties, pushing up prices.”
CrowdProperty provides fast, simple and transparent property project finance for property professionals, learn more.
Opinions or views expressed represent the thoughts of individuals and not those of CrowdProperty or Cache.
May 2025
Australian home values continued to edge higher in April, despite the uncertainty created by Trump’s Liberation Day tariffs and the lead up to the federal election.
The Albanese government’s win could trigger a boom in the housing market, given its increased mandate from Australians to solve the home affordability crisis.
Australian housing prices rise for third month straight
Cotality’s [formerly CoreLogic] national Home Value Index posted a 0.3 percent rise in April, hitting a record high following its third consecutive month of increase. The rise nonetheless marked a modest easing compared to the 0.4 percent rise posted in March.
All of Australia’s capital cities saw increases, led by Darwin with a 1.1 percent rise. Sydney and Melbourne both lagged the nationwide increase, with both seeing a 0.2 rise in their home values.
Tim Lawless, Cotality’s research director, said that the RBA’s February rate cut provided further support to home prices, but this was undermined by the uncertainty surrounding Trump’s surprise tariffs and the federal election.
Albanese’s election win strengthens housing crisis mandate
The Labor party managed to increase its seat majority with its federal election win at the start of May, expanding Anthony Albanese’s clout as national leader.
If Albanese capitalises upon this show of confidence from the Australian public to make good on his election promises, it could prove a boon for the development sector.
Albanese campaigned on solving the home affordability crisis, with a special focus on solving the pain point of younger Australians seeking to enter the housing market.
Labour’s promises include a $10 billion plan for the development of 100,000 new homes dedicated to first home buyers.
The scheme will see government identify commonwealth-owned land that’s available for development, as well as spur states and territories to fast-track approvals.
Since it first assumed government in 2022, Labor has committed to over $43 billion in spending on housing policy.
CrowdProperty CEO David Ingram said the federal election result provides clear political momentum for housing policy.
“We’re seeing that translate into renewed developer confidence,” Ingram said.
“April was a record-breaking month for CrowdProperty, with over $273 million in loan applications — a strong indicator that SME developers are preparing to deliver more housing if the conditions are right. Confidence is rising, but it must be matched by consistent policy execution and support for the developers actually building the homes.
“Funding is the oxygen of housing delivery and SME developers’ biggest challenge to building more homes — it’s often the piece overlooked when policy is discussed,” he said.
“Traditional lenders are still risk-averse, especially with smaller-scale projects. That’s why non-bank finance is playing a critical role in unlocking stalled supply pipelines. At CrowdProperty, our platform is designed to get capital into the hands of capable developers quickly and efficiently — aligning finance with national housing goals.”
Leanne Pilkington, president of the Real Estate Institute of Australia, said Labor’s resounding success in the federal election gives Albanese a firm mandate to follow through on its campaign promises.
“Labor’s return to office comes with a strong mandate to tackle affordability and increase home ownership across the country,” Ms Pilkington said.
“We welcome Labor’s emphasis on supply and affordability. Support for first-home buyers is a vital step toward bridging the generational divide in housing access.”
Labor’s property policies could mean a housing boom
Rob Flux, developer and educator at the Property Developer Network, said that the combined impact of Labor’s housing policies could trigger a boom in the market.
Flux highlights the five percent deposit requirement for first-home owners — a figure which will be even lower when combined with state initiatives — as well as the help-to-buy initiative, which will see the government help buyers by acting as a joint-owner in their homes.
A raft of build-to-rent initiatives will also incentivise the development of more rentable stock, while the ban on foreign investors buying up second-homes should drive the development of new builds and kick-start the construction sector.
“When we combine all of the elements together, a housing boom over the next three to four years is the most likely outcome,” Flux said.
“The challenge will be whether we have enough builders and trades to take on the workload that sits behind this.”
CrowdProperty property director Brian Cullen said that while talk of a housing boom creates optimism, experienced SME developers know that feasibility remains the critical filter between ambition and reality.
“Construction costs, land pricing, and labour availability are still influential variables — but not insurmountable ones,” Cullen said.
“The key is project discipline — strong due diligence, cost control, and having the right finance partners who understand the nuances of the market.
“At CrowdProperty, we work closely with our developer partners to navigate these factors with clarity and confidence, ensuring that good projects remain viable and deliverable, even in a shifting environment.”
Australia still behind on housing targets
Despite committing to solving the housing crisis, the Albanese government’s first term in office has seen Australian housing development fall well short of its ambitious targets.
Albanese’s landmark housing policy in his first term was the National Housing Accord, which sets the ambitious goal of building 1.2 million new well-located homes over the five year period starting from 1 July 2024.
Urban Taskforce Australia CEO Tom Forrest warns that Australia has fallen far short of this goal in the first year of the Accord.
ABS housing completion and commencement figures indicate that only 168,049 dwellings commenced construction in 2024 — 30 percent short of what the National Housing Accord requires.
This means Australia now already faces the enormous task of compensating for this shortfall, as well as making good on the 240,000 new houses needed each year on average to satisfy the target of 1.2 million new homes by 2030.
David Ingram said that to meet the 1.2 million home target, the industry needs to mobilise every part of the development ecosystem.
“This especially applies to the SME development sector, which is best placed to deliver fast, flexible, infill ‘missing middle’ housing,” he said.
“That means giving them access not only to finance, but to planning pathways, repeatable project models, and a supportive policy environment. At CrowdProperty, we’re seeing record demand from developers ready to build — now’s the time to back them.”
CrowdProperty provides fast, simple and transparent property project finance for property professionals, learn more.
Opinions or views expressed represent the thoughts of individuals and not those of CrowdProperty or Cache.
