A Market That’s Moving, Quietly but Surely
April marked the third consecutive month of growth in Australia’s housing market. According to CoreLogic’s latest Home Value Index, dwelling values rose by 0.3% nationally, adding approximately $2,720 to the median home value. While the rise may appear modest, this growth comes despite growing global uncertainty and domestic hesitation ahead of the federal election.
Every capital city recorded an increase in values, with Darwin leading at 1.1% and Sydney and Melbourne each posting 0.2%. However, auction clearance rates and new listings slumped, revealing a cautious but still climbing market.
The key takeaway is that the market is not booming, but it’s not backing down either. Instead, it’s adjusting and stabilising, and in that process, it’s opening meaningful opportunities for property investors.
Rate Cuts Have Helped, But the Impact Is Fading
February’s 25 basis point rate cut affected sentiment, reversing a short-term decline in value. However, the influence of lower interest rates appears to be tapering. As CoreLogic notes, buyer and seller confidence softened again in April, with the upcoming federal election and U.S. trade tensions acting as drag factors.
That said, further rate cuts are likely. Another drop as early as May 20 could boost conditions again. Combined with the resolution of election uncertainty, the stage is set for a renewed pulse in the market heading into mid-year.
Growth is Happening — Not Where Many Expect
Contrary to Sydney and Melbourne’s traditional dominance, the strongest growth is seen in the mid-sized capitals and regional areas.
- Brisbane: Up 7.8% annually
- Adelaide: Up 9.8% annually
- Perth: Up 10.0% annually
- Darwin: Up 2.5% annually
In contrast, Sydney remains 1.1% below its 2024 peak, while Melbourne is still 5.4% down from its 2022 high.
This regional and mid-capital momentum highlights a clear shift. Value growth concerns population size, affordability, lifestyle appeal, and relative market tightness.
Houses Still Beating Units
Over the last three months, house values have increased 1.1% across the combined capitals, while unit values have only increased 0.5%. House prices rose 1.4% in Sydney, but unit values fell by 0.3%.
This divergence is being driven by demand for family-sized homes and land-rich properties. In a post-pandemic world where lifestyle flexibility and remote work remain relevant, houses attract stronger buyer interest than compact urban dwellings.
Regional Australia Outperforming Again
Regional housing values rose by 0.6% in April, outpacing the 0.2% rise across the capitals. This trend mirrors what we saw during the pandemic, re-emerging as affordability constraints push buyers further afield.
Top performing regions include:
- Regional South Australia: Up 1.5% in April
- Regional Western Australia: Up 1.3% in April
These areas are not just lifestyle-driven; they are increasingly seen as viable investment zones with strong rental yields and lower entry prices.
Supply is Tight and Getting Tighter
Despite growth in values, new listings have fallen to their lowest April levels since 2019. Building activity is not filling the gap either. Dwelling commencements remain more than 16% below the decade average, and construction costs continue to rise.
According to AMP estimates, Australia is currently short by between 200,000 and 300,000 homes. This undersupply is a structural issue, not a short-term trend. It will take years to correct, and during that time, property prices will likely remain under upward pressure.
Affordability is a Barrier, but Not a Dealbreaker
Yes, affordability is stretched. The average household now needs over 10 years to save a 20% deposit and spends more than 50% of its gross income on mortgage repayments. However, for investors, this creates increased rental demand and upward pressure on yields.
Gross rental yields have climbed to 3.73% nationally, the highest level in two years. Regional yields are even stronger, averaging 4.41%. These are encouraging signals for those looking to balance capital growth with steady cash flow.
What This Means for You as an Investor
Here is how to interpret all of this from an investment perspective:
- Act Before Confidence Fully Returns
Waiting for certainty usually means buying at the top. Right now, the market is experiencing a moment of hesitation, which creates room for negotiation, strategy, and selectivity.
- Focus on Undersupplied, Affordable Markets
The most sustainable growth will likely occur in areas with ongoing supply constraints and strong rental returns. Think regional growth corridors and mid-sized capitals rather than trying to time a bounce in Sydney or Melbourne.
- Understand the Policy Environment
With both major parties expected to roll out buyer incentives, especially for first-home buyers, the lower end of the market could get more competitive. Savvy investors should plan now to position themselves ahead of that policy-driven demand.
- Houses Over Units — For Now
In most locations, houses are continuing to outperform. Look for suburbs where land is scarce, infrastructure investment is happening, and rental demand is high.
Final Thoughts
April’s data sends a clear message: Australian property remains resilient despite global jitters and election noise. Growth may be slower, but it is steady. Demand, supply, lending conditions, and yield potential fundamentals are still supportive.
Savvy investors will use this period not to wait but to prepare. They will identify the right markets, make strategic decisions, and stay ahead of the next wave of activity.
If you’re considering your next move or want guidance on where to invest now, I’m here to help.
Richard Crabb
Property Investment Advisor
ASPIRE Property Advisor Network
This article is intended as general commentary and does not constitute personal financial advice.
