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Home Prices Keep Rising Amid Persistent Supply Shortages

Tight Listings and Rising Buyer Confidence Fuel Strong August Gains

Blog / News / 2025 August 28, 2025
properties in Melbourne

In August, Australian property prices continued their upward trajectory, as lower interest rates, real wage growth, and heightened consumer optimism collided with a shortage of homes available for sale.

According to property research firm Cotality (formerly CoreLogic), national home values increased by 0.7%, marking the seventh consecutive monthly rise—the strongest monthly gain since May of the previous year.

The national median home value now sits at A$848,858, representing a 4.1% increase year-on-year.

Among capital cities, Brisbane experienced the strongest monthly rise, with property values up 1.2%, reaching a median of A$949,538. Hobart stood as the sole city to record a decline, with values falling by 0.2%, while Sydney remained the priciest city, with a median value of A$1,224,341.

On an annual basis, Darwin posted the largest gain, with values up 10.2%, now around A$553,131.

Eliza Owen, Cotality’s head of research, pointed to the straightforward interplay of stronger demand—including real wages at their highest level in five years—lower interest rates, and mounting consumer confidence, all meeting a shrinking supply of homes for sale.

Currently, advertised listings are down approximately 20% compared to the typical five-year average—roughly 120,000 properties are on the market versus the usual 150,000. This ongoing imbalance continues to underpin rising home values.

Looking ahead, experts anticipate that further interest rate cuts, alongside the federal government's expanded First Homebuyer Guarantee scheme, are likely to boost demand even more—and, potentially, push prices higher.



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