House Prices Rising Across All Capital Cities.

Why the June 2025 quarter marks a turning point for Australia’s property market

For the first time in four years, property prices increased in every Australian capital city over the June 2025 quarter. This broad-based lift signals a notable shift in market sentiment—one being fuelled by interest rate cuts, robust buyer demand, and a continued shortage of quality stock.

While houses remain a long-term favourite, it’s units that are currently stealing the spotlight. In several cities, unit prices are now outpacing house prices, driven by affordability pressures, lifestyle shifts, and record-high rents pushing more buyers towards apartment living.

Why this is happening now

Several forces are converging:

• Interest rate cuts have improved borrowing capacity, bringing more buyers back into the market.
• Population growth—particularly in Sydney, Melbourne, Brisbane, and Perth—is keeping pressure on demand.
• Tight supply means buyers are competing for a limited pool of well-located properties.
• Affordability constraints are shifting buyer preferences towards units, especially in inner and middle-ring suburbs.

Melbourne – the standout opportunity

While all capital cities have seen gains, Melbourne presents one of the most compelling buying windows in the country right now.

• Over recent years, wages have steadily increased while property values have largely held flat, improving overall affordability.
• Massive government investment in infrastructure—from transport upgrades to health and education—continues to enhance connectivity and liveability.
• A persistent lack of supply of quality stock is creating competitive conditions for well-located properties.
• Strong population growth, both from overseas migration and interstate movement, is fuelling demand.

For astute buyers, these fundamentals mean Melbourne offers a rare alignment of affordability, growth potential, and long-term resilience.

What it means for investors

For investors, this is a reminder that property cycles don’t move in isolation. While houses typically deliver stronger capital growth over the long term, the current window for unit performance is worth noting—particularly in cities where price gaps between houses and units have narrowed.

Opportunities we’re watching:

• Quality townhouses in established suburbs with strong rental demand.
• Entry-level houses in gentrifying middle-ring areas.
• Well-located properties with potential for value-adding renovations or redevelopment.

The bottom line

The June 2025 quarter confirms the market’s resilience. If you’ve been waiting for “the right time” to act, conditions are now firmly in the phase where well-selected assets can outperform. The challenge—and the opportunity—lies in knowing where to buy and what to avoid as competition heats up.

At 1Group, we combine on-the-ground experience with deep market analysis to help our clients secure properties that are positioned for long-term growth—no matter where we are in the cycle.

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