The pace of growth in Australian home values accelerated in October, rising by 1.1 per cent – the fastest monthly gain since June 2023.
According to property research group, Cotality, momentum has been building in the rate of housing value growth since the first interest rate cut in February, pushing the annual pace of growth to 6.1 per cent nationally.
Here’s a snapshot of Australia’s housing market right now:
Monthly gains
“Before the February rate cut, housing conditions were losing momentum, even recording flat to falling values through late 2024 and January 2025,” said Tim Lawless, Cotality’s research director. “The first rate cut in February marked a clear turning point, with home values moving through a positive inflection across most regions and gathering steam since then.”
Monthly gains have been broad-based, with every capital city and rest-of-state region recording a monthly rise in value, ranging from a 1.9 per cent surge in Perth to a 0.3 per cent rise across Hobart.
There are many factors contributing to stronger housing conditions, but ultimately the uptick in growth is reflective of supply continuing to fall well short of demand. At the national level, Cotality’s rolling quarterly estimate of home sales is tracking 3.1 per cent above the previous five-year average, while advertised supply levels over the four weeks to October 26 were 18 per cent below average.
Such tight advertised supply levels against above-average levels of demonstrated demand have skewed selling conditions towards vendors through spring. Although auction clearance rates have eased a little, they have held above the decade average – in the high 60 per cent to low 70 per cent range since the start of spring.
The step up in growth rates also coincides with the expanded 5 per cent deposit guarantee scheme going live on October 1, which has likely added to housing demand, especially around the lower to middle price points of the market.
It is the broad middle and lower quartile of the market where gains are strongest. Across the combined capitals, dwelling values were up 1.4 per cent across the middle market and rose 1.2 per cent across the lower quartile, while upper quartile values were 0.7 per cent higher through the month.
Nation-wide trend
Among the capital cities, for the first time in a while, Melbourne had a better monthly return than Sydney.
Regional markets also posted a solid increase in the monthly rate of growth, with the 1 per cent increase the highest monthly gain across the combined regional markets since March 2022. Regional WA recorded the strongest rise, with a 1.8 per cent increase in values, followed by Regional Qld up 1.1 per cent and Regional NSW with a 1 per cent lift.
Spring selling season
While there has been a lift in listings with ‘spring selling season’, this was subdued. Values are still on the up, though.
According to SQM Research, the number of properties up for sale rose, as expected, for this time of year. National residential listings surged 10.9 per cent month-on-month in October, but remain 0.3 per cent lower year-on-year.
Sydney and Melbourne led the monthly lift – up 13.2 per cent and 15.4 per cent respectively – reflecting robust spring activity.
New listings (added in the last 30 days) rose 18.2 per cent nationally, driven by Melbourne (+23.7 per cent) and Adelaide (+33.5 per cent).
Old listings (180 + days) edged up 1 per cent month-on-month while distressed listings held steady nationally but are down 29.5 per cent year-on-year, with large declines in WA (-50.1 per cent) and NSW (-24.9 per cent).
Lenders are confident
This is why banks are comfortable with their home loan customers despite them having record levels of debt – their home values are going up which means very few are in negative equity.
If there is a need to sell, owners can do it quickly and at strong values.
