How Did Property Prices Perform in 2024? And What’s Forecast for 2025?

As we approach the close of 2024, it’s time to review how property markets have fared over the past year and what the experts are predicting for the future. The landscape has been dynamic, with varying changes in property values and market conditions across Australia’s major cities.

The Year in Review

2024 has been a period of notable transition in the property market, with home values and market trends evolving in state and territory capitals. The only consistent factor has been the Reserve Bank of Australia’s cash rate, which has remained steady at 4.35% since November 2023. CoreLogic reported a national home value increase of 5.5% this year, but as we move into 2025, growth seems to be losing momentum, especially in Melbourne and Sydney.

Australia-Wide Market Overview

November 2024 saw a modest rise in home values by just 0.1%, marking the 22nd consecutive month of growth since January 2023. While this figure may not suggest strong momentum, it does indicate a cooling market, and experts are forecasting a potential downturn. This is particularly good news for buyers, who may find more favourable conditions in 2025.

A Look Across the Major Capital Cities

Queensland

Brisbane’s property market has seen significant growth, with home prices up 12.1% over the past year. While this rate may not be sustainable, Domain predicts a more moderate 5-7% increase for houses and 7-9% for apartments in 2025.

New South Wales

Sydney’s property market has risen by 3.3% over the past year, with values flattening or slightly declining since reaching a cycle peak in August. CoreLogic’s data suggests that the city’s median home price of $1.2 million remains a challenge for many buyers. Domain is forecasting a 4-6% rise in home values for 2025.

Victoria

Melbourne has been the standout loser in terms of property price growth, recording a 2.3% decline over the past 12 months. However, Domain is optimistic about a potential turnaround, predicting a 3-5% rise in house values next year, though apartments could see a slight decrease of up to 2%.

Australian Capital Territory

Canberra’s housing market has been relatively stable in 2024, with just a 0.1% decline in values. Optimistic predictions from Domain expect house prices to rise 3-5% next year, while unit values may drop by up to 4%.

Tasmania

Hobart experienced a 1% fall in property values over the year to November, marking a 12.1% decline since the market peaked in March 2022. However, with more affordable prices and recent stamp duty reforms, 2025 could see a resurgence in first home buyer activity in Tasmania, potentially driving values up.

South Australia

Adelaide’s market has been strong, with home values rising 14% over the past year. Despite a slight cooling over the past few months, Domain forecasts a 7-9% rise in property prices for 2025, suggesting sustained momentum in the market.

Western Australia

Perth has been one of the standout markets, with home prices soaring 21% over the past year. While listings increased by 33% in November, CoreLogic notes that the pace of growth is slowing. Domain’s forecast of 8-10% price rise for 2025 indicates that Perth’s market is still performing strongly.

Northern Territory

Darwin’s property market has been relatively subdued, with just 0.9% growth over the past 12 months. However, SQM Research predicts that Darwin could see home values rise between 3% and 10% in 2025, depending on factors like interest rates and population growth.

Preparing for 2025: Know Your Borrowing Power

With a cooler market on the horizon, 2025 might be the ideal time to buy property. If you’re considering purchasing your first home, an investment property, or upgrading your current residence, now is the time to get a clearer picture of your borrowing power. 

At Osinski Finance, we’re here to provide insights into your financial options and help make your property aspirations a reality. Give us a call for personalised advice!

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.