Record-breaking surge pushes Australian housing market value to $11.6 trillion

The total value of the housing market has soared in the months since rates were first cut.

Australia’s housing market has become worth five times the annual output of the economy after total property values soared $213 billion in the months following the first interest rate cut this year.

ABS Figures released Tuesday showed the total value of the country’s residential dwellings rose to $11.6 trillion in the June quarter, up from $11.35 trillion in March.

Australia’s nominal GDP is estimated to reach about A$2.58 trillion to $2.7 trillion over 2025, according to current projections.

It comes as property experts reveal housing demand has soared across many regions of the country since the Reserve Bank announced the first of three interest rate cuts this year in February.

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This has driven strong price increases, especially in medium-sized cities such as Brisbane, Adelaide and Perth, where dwelling prices are close to 10 per cent higher than a year ago, PropTrack data showed.

Sydney growth has been more measured at 3.66 per cent, while Melbourne home values were up an average of 2.1 per cent compared to August 2024.

The amount of wealth now locked up in the housing market dwarfs the value of some of the country’s biggest companies.

The $11.6 trillion total value of residential dwellings was higher than the combined market capitalisation of the top 50 companies listed on the ASX, including companies such as CBA, BHP and NAB.

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The total value of Aussie residential dwellings exceeds the market cap of our big four banks.

It’s a marked shift from five years ago when the combined value of residential dwellings across the country was $7.25 trillion, according to the ABS.

ABS head of finance statistics Dr Mish Tan said home values were rising across the country.

“June quarter’s growth in the value of dwellings followed a 0.3 per cent rise in the March quarter, with rises across all states and territories,” she said.

Dr Tan added that the total value of dwellings was 5.1 per cent higher than a year ago.

ABS lending data released in August revealed much of the increased spending in the housing market was coming from investors.

The number of new loans being issued to investors rose 3.5 per cent over the June quarter, while new owner occupier loans rose by just under 1 per cent.

Dr Tan described lending activity as being at “relatively high levels”.

Mortgage Choice broker James Algar said buyer demand was expected to increase substantially once the federal government expands its Home Guarantee Scheme in October.

The scheme allows eligible first-home buyers to purchase properties with 5 per cent deposits and avoid paying pricey lender’s mortgage insurance.

The October changes will remove previous salary limits for the scheme and expand the previous price caps.

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