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Australian Home Prices Hit Record High Amid Slowing Growth
5 Jan
Summary
- National home prices reached a record $880,000 in December.
- Annual growth reached 8.8%, though monthly growth slowed to 0.1%.
- Regional areas outperformed capital cities in price growth throughout 2025.
National home prices in Australia reached an all-time high of $880,000 in December, closing out 2025 with an annual increase of 8.8%. Although Sydney and Melbourne saw slight dips in December, their yearly gains remained positive. Brisbane, Adelaide, and Perth experienced significant growth, with Brisbane surpassing the million-dollar median.
Regional areas demonstrated stronger price growth compared to capital cities over 2025, driven by a 0.4% monthly increase and substantial annual gains. Despite predictions of reaching new highs in 2026, the rate of growth is expected to decelerate, partly due to the absence of anticipated interest rate cuts and potential inflation concerns prompting a Reserve Bank of Australia review of rates.
Factors like the government's five percent deposit scheme, persistent housing supply shortages, and rising construction costs are anticipated to sustain demand and price increases. While 2025 saw robust gains, mirroring the strongest calendar-year increase since 2021, the market dynamics suggest a continued, albeit moderated, upward trend for 2026.
