Australia set for new real estate boom

Australian homeowners are celebrating a spring surge, with national home prices recording their ninth consecutive month of growth in September, adding a significant $54,100 to the median property value.

The buoyant market comes as the Reserve Bank of Australia on Tuesday confirmed a pause in its interest rate cycle, holding the cash rate steady at 3.60 per cent, a move expected to further fuel buyer confidence.

The latest PropTrack Home Price Index for September 2025, released Wednesday reveals a robust property landscape, with national home prices climbing 0.5 per cent over the month.

This impressive run pushes annual growth to 6.2 per cent, underscoring a powerful rebound in the nation’s housing sector.

Capital cities led the charge, with prices rising 0.6 per cent in September, now sitting 6 per cent higher than a year ago.

Notably, all markets across the country recorded monthly price growth, signalling a broadbased recovery.

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Source: PropTrack

Hobart emerged as the top performer for the month, with a substantial 0.8 per cent increase, closely followed by Sydney at 0.7 per cent.

Annually, Darwin has seen an extraordinary 11.4 per cent climb, with Brisbane also experiencing strong growth at 10.2 per cent over the past year.

Regional areas are not to be outdone, with home prices hitting a new peak in September, lifting 0.4 per cent over the month to be 7.1 per cent higher than a year ago.

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REA Group Senior Economist Eleanor Creagh highlighted the critical role of the RBA’s decision in shaping market sentiment.

“As expected, the RBA held the cash rate steady at 3.60 per cent at its September meeting, with the Bank remains cautious and data-dependent as it waits for the September quarter inflation report,” she said.

“This is due the week before the November meeting and will provide a clearer read on the inflation trajectory before committing to another move.”

Source: PropTrack

Ms Creagh explained that keeping interest rates on hold allowed the RBA to assess incoming data and balance risks.

“Inflation is contained, the economy is operating near full employment, but job growth has slowed, and vacancies continue to decline. Against that backdrop, the RBA is in no rush to cut again, but nor does it see the need to keep policy restrictive,” she said.

For households, the impact of earlier rate cuts this year has been profound.

“Earlier rate cuts this year have lowered mortgage repayments and boosted borrowing capacities and confidence. This has helped to drive a synchronised housing market upswing, with demand building into the spring selling season,” Ms Creagh observed.

The Aussie real estate market is expected to boom in 2026. Picture: Tim Hunter.

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Despite ongoing affordability pressures, Ms Creagh anticipates continued upward momentum.

“While affordability pressures remain, this year’s series of interest rate cuts, improved sentiment, and the October expansion of the Home Guarantee Scheme, are expected to keep upward pressure on home prices in the months ahead,” she said.

“With stock on market constrained and new supply challenged, demand-side stimulus will intensify competition.

“The housing market is poised for further gains throughout spring, though the pace will vary across cities.”

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REA Group Senior Economist Eleanor Creagh

The current market strength marks a significant turnaround from the slower conditions observed in late 2024.

“With interest rates moving lower this year, momentum in the housing market has strengthened, marking a turnaround from the slower conditions observed in late 2024. Renewed buyer sentiment, supported by earlier rate cuts is underpinning this recovery,” Ms Creagh concluded.

As spring progresses, all eyes will remain on inflation data and future RBA decisions, but for now, the Australian property market appears to be on a clear trajectory of sustained growth.

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