Australian regions defying price falls in 2025

Home prices are falling across the country, but these promising regions are bucking the trend with strong growth

REA Group economic analyst Megan Lieu. Supplied

Analysis

National home prices have fallen over the past quarter following an improvement in supply, declining affordability and weaker market conditions. Yet despite this, a number of regions are still facing price increases.

New data from PropTrack revealed that home prices fell by 0.1 per cent in January, marking the second consecutive month of decline after a 0.2 per cent decrease in December.

National home prices are now 0.3 per cent lower than October 2024 levels.

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Across the capital cities, prices have decreased by 0.7 per cent over the past quarter, while combined regional areas have experienced a 0.6 per cent rise during the same period.

The New England region has been performing strongly.

NSW

A similar trend was seen in NSW over the quarter, with prices dropping 0.9 per cent in Sydney, in contrast to the 0.8 per cent increase in regional NSW.

While the overall market has faced price declines and a deceleration in price growth, there are areas continuing to perform strongly in January.

New England and North West, Riverina and Central West recorded the largest quarterly growth in home prices among all SA4 regions in New South Wales. Prices were respectively 2.6 per cent, 2.1 per cent and 2 per cent higher than three months prior.

Over the same period, the Mid North Coast and Southern Highlands and Shoalhaven regions also experienced respective home price increases of 1.1 per cent and 1 per cent.

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The growth of these areas within regional NSW confirms that regions are outperforming metro areas in terms of price growth.

The Mid North Coast, home of Port Macquarie, is proving popular with buyers.

VIC

In Victoria, prices in both regional and metro areas have declined since October 2024, with a slight drop of 0.23 per cent in regional VIC and a stronger 1.6 per cent decline in Melbourne.

Some areas, however, continued to perform strongly in January.

Shepparton, North West and Warrnambool and South West recorded the largest quarterly growth in home prices among all SA4 regions in Victoria. Prices were respectively 0.7 per cent, 0.6 per cent and 0.5 per cent higher than three months prior.

Shepparton was Victoria’s top performer

Over the same period, Bendigo and Ballarat experienced respective home price increases of 0.3 per cent and 0.1 per cent.

VIC regions, like in NSW, are outperforming metro areas for price growth.

QLD

Toowoomba, Townsville and Wide Bay recorded the largest quarterly growth in home prices among all SA4 regions in Queensland. Prices were respectively 2.2 per cent, 2.1 per cent and 2.1 per cent higher than three months prior.

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Over the same period, the Central Queensland and Logan – Beaudesert regions experienced home price increases of 2 per cent and 1.5 per cent, respectively.

Toowoomba was top of the pops in Qld.

As these areas are situated in both Brisbane and regional Queensland, evidence suggests regional and metro areas across the state are experiencing similar quarterly price growth.

SA

In South Australia, home prices in regional and metro areas both rose. However, regional SA saw larger gains of 3 per cent compared to Adelaide’s increase of 0.6 per cent since October 2024.

Contrary to national trends, there are also areas continuing to perform strongly in South Australia.

Barossa – Yorke – Mid North, South Australia – South East and Adelaide – Central and Hills recorded the largest quarterly growth in home prices among all SA4 regions in South Australia. Prices were respectively 3.5 per cent, 3.2 per cent and 1.2 per cent higher in January compared to three months prior.

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Rate cut effect

Throughout 2024, the total number of properties on the national market rose by 5.7 per cent to December, giving buyers more choice and bargaining power. Additionally, wage growth has lagged behind home price increases over the past few years. Combined with higher interest rates, these factors have contributed to the recent decline in home prices.

However, with interest rate cuts expected in the near future, the falls over the past few months are likely to reverse. It is anticipated that prices will start to rise once again as borrowing capacities improve.

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Although, given that housing affordability remains strained and is currently hovering at its lowest historical level, it is unlikely that prices will increase as significantly as they have during previous periods of interest rate reductions.

Megan Lieu is an REA Group economic analyst.

Originally published as Australian regions defying price falls in 2025