Key takeaways
Proptrack report that national home prices hit a new record in October, rising 0.26% over the month.
Australian home prices are now 5.62% higher than a year ago.
Prices in the combined capital cities have increased 5.85% over the past year, after climbing a further 0.28% in October. However, price performance remains mixed across Australia.
After six months of falls, the fortunes of Melbourne’s homeowners improved in October, with prices jumping 0.49% – the highest monthly growth rate of the capitals.
Following Melbourne, Adelaide (+0.43%) and Perth (+0.32%) recorded the strongest growth in October of the capital cities.
Perth, Adelaide and Brisbane remain the strongest capital city markets for annual growth, with prices up 20.58%, 14.91% and 12.51% over the past year, respectively.
Capital city prices have outpaced regional areas over the past year and this trend persisted in October. Prices in regional areas rose 0.20% over the month and are now up 5.03% year-on-year.
Performance was also diverse in regional areas. Regional SA (+0.57%) and regional Queensland (+0.34%) led growth in October and recorded robust annual growth, while prices in regional Victoria have been relative weaker, down 1.51% over the past year.
Australia’s home prices reached new heights in October with buyers out in force at the height of the spring selling season, according to the latest PropTrack Home Price Index.
Ms Eleanor Creagh, Senior Economist at PropTrack explained:
“Though price growth had been slowing, the stronger October rise of 0.26% marks a reacceleration after slowing through winter and early spring.
This marks 22 straight consecutive months of growth for national home prices against a backdrop of resilient housing demand defying affordability constraints.
More homes listed for sale has provided greater choice for buyers and, despite price growth regaining momentum in every capital except Brisbane, Adelaide, and Darwin in October, growth remained below the faster pace seen at the end of the summer selling season.
There remained significant regional disparities in the pace of growth too, with varying supply and demand conditions driving the diverse performance.”
Home price growth accelerates with spring selling season in full swing
According to PropTrack’s data, the increase in properties hitting the market in recent months has been met with strong demand, but is a contributor to slowing price growth along with affordability constraints and sustained high interest rates.
Ms Creagh further explained:
“The pace of home price growth remained varied across the capitals in October, reflecting multi-speed market conditions, with differing supply and demand conditions continuing diverse performance across the country.
Prices in the combined capital cities have increased 5.85% over the past year, after climbing 0.28% in October.
The increase in properties hitting the market in recent months has been met with strong demand, but is a contributor to slowing price growth along with affordability constraints and sustained high interest rates.
The pace of home price growth remained varied across the capitals in October, reflecting multi-speed market conditions, with differing supply and demand conditions continuing diverse performance across the country.
Prices in the combined capital cities have increased 5.85% over the past year, after climbing 0.28% in October.”
Capital cities retain their lead over the year
PropTrack’s data show that capital city prices outpaced regional areas in the past year and this trend persisted in October.
Prices in regional areas rose 0.20% over the month to be 5.03% above October 2023 levels.
Performance was also diverse in regional areas. Regional SA (+0.57%) and regional Queensland (+0.34%) led growth in October and recorded robust annual growth, while prices in regional Victoria saw relative weakness, down 1.51% during the past year.
Ms Creagh further said:
“Differing supply and demand conditions are contributing with buyers in regional Victoria enjoying a lot more choice contributing to subdued price momentum.
Meanwhile Victoria’s unemployment rate has risen over the last year, and is now the highest in the country.”
Outlook
Ms Creagh highlighted an interesting trend in Australia’s housing market: demand remains robust despite affordability challenges, with prices climbing across most regions in October.
After a mid-year slowdown, home price growth has regained momentum, particularly at the height of the spring selling season, a period known for heightened buyer activity and greater property listings.
While the resurgence in price growth is widespread, some cities like Brisbane, Adelaide, and Darwin saw slower gains, emphasizing that local supply and demand dynamics continue to shape each market’s performance.
Nationally, however, demand-supporting factors remain strong.
Key to this is the July tax cut, which expanded borrowing capacity and buyer budgets, offering many Australians a path forward despite rising costs.
Further underpinning demand is Australia’s rapid population growth, tight rental market, and the desire of many buyers to leverage existing home equity – all drivers that have continued to push housing prices higher.
Yet, challenges persist.
Ms Creagh notes that housing supply remains restricted, largely due to ongoing struggles within the building industry.
Limited new housing construction continues to exacerbate Australia’s chronic housing shortage, further supporting price growth.
Interestingly, while October saw a rebound in price growth, high interest rates and affordability barriers still weigh heavily on buyers’ decision-making.
The increase in property listings may offer more choice, but many are holding off in hopes of interest rate cuts.
Until clearer signals on rates emerge, buyers may continue navigating these mixed market forces with caution.
As the busier selling season winds down, price growth may persist, buoyed by strong demand fundamentals and limited supply, even as affordability remains a key concern.
