Australia’s regional housing market continues to show resilience, with home values rising by 1% in the three months leading up to January 2025. This growth was recorded in three-quarters of regional suburbs, highlighting the ongoing demand for property outside of major metropolitan areas.
In contrast, capital city markets are feeling the pressure, with nearly half of urban suburbs seeing a 0.7% price decline. Sydney and Melbourne were the hardest hit, with three in four Sydney suburbs and a staggering 90% of Melbourne suburbs recording price drops.
Why Are Regional Home Values Holding Strong?
CoreLogic economist Kaytlin Ezzy points to evolving work trends as a major factor influencing buyer behavior.
“With more people able to prioritise lifestyle over job location, the flow of internal migrants to regional markets has settled higher than the levels seen pre-COVID, helping to support housing demand,” she explains.
Regional markets continue to attract buyers seeking affordability, lifestyle benefits, and more space, while increased supply in capital cities has placed downward pressure on prices.
Are More Cities Following This Trend?
While Sydney and Melbourne have led the declines, Brisbane, Adelaide, and Perth are beginning to experience a slowdown in their previously strong price growth. The cooling momentum suggests that these markets could see similar trends in the coming months.
On a national scale, Australian home values dropped by 0.3% over the quarter, with the residential real estate market valued at $11.1 trillion as of January 2025.
What This Means for Buyers and Sellers
With affordability concerns growing, capital city buyers now have more options as stock levels rise and overseas migration slows. These conditions are tipping the scales in favor of buyers in metro areas, providing opportunities for those looking to enter the market or upgrade their homes.
Meanwhile, regional property owners continue to benefit from strong demand, ensuring a solid outlook for those considering selling in the near future.
As the market shifts, understanding local trends is key to making informed real estate decisions. Whether you're looking to buy, sell, or invest, staying ahead of the curve will help you navigate these changing conditions with confidence.