What your home will be worth in two years
Property prices are expected to start climbing again, but the rises will vary considerably by location. See how values in your area will change
Property prices in much of Australia could rise by more than $100,000 over the next two years, despite higher interest rates and already daunting affordability barriers for new buyers.
Exclusive analysis of PropTrack data and KMPG property forecasts indicated much of the housing market was on course for another round of strong growth.
And it’s likely this next wave of growth would push prices in most locations well past their previous peaks recorded in early 2022, when interest rates were at historic lows.
House prices were expected to average $1.53m in Sydney and $1.02m in Melbourne by 2025, the analysis showed.
Brisbane’s median house price would be about $814,000 in two years, while in Adelaide and Perth it would be about $768,000 and $678,000, respectively.
But buyers in key locations could be paying well above the median prices in each city.
Applying the citywide capital city forecasts to individual suburbs showed there could be an explosion in the number of locations where prices above $1m were the norm.
Close to 40 locations in Brisbane and the Gold Coast would become $1m+ suburbs in the next two years, while in Melbourne there would be 68 new suburbs joining that category.
In Sydney, 42 suburbs would see $2m median house prices for the first time by mid-2025.
KPMG chief economist Brendan Rynne said constrained property supply would be one of the key price drivers during the current financial year.
SEE LIST OF SUBURBS BELOW
“House and unit prices will then accelerate further in the next financial year as dwelling supply continues to be limited, due to scarcity of available land, falling levels of approvals and slower or more costly construction activity,” Mr Rynne said.
Housing shortages will combine with several other factors to push assets prices up next year, he added.
This included higher demand due to migration, anticipated rate cuts moving in FY25, potentially relaxed lending conditions and high rental costs pushing more tenants to become homeowners.
KMPG further anticipated that foreign investor demand would pick up again, while developers would continue to struggle getting new housing projects off the ground.
House prices were expected to grow faster than unit prices owing to the post-pandemic demand for more space as people continue to work from home, Mr Rynne said.
It comes as PropTrack economist Eleanor Creagh warned there was a “startling shortfall” between the number of people expected to call Australia home and the number of homes for those people to live in.
She pointed to ABS figures that showed 300,000 migrants could arrive over 2023. Australia completed around 170,000 new homes over the year to March 2023.
“Faster than expected population growth has meant more people are calling Australia home, against the backdrop of pre-existing housing supply issues, giving rise to a mismatch between housing supply and demand,” Ms Creagh said. “We need to increase our pace of building by almost 40 per cent from where it currently stands.”
SYDNEY
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CHANGES IN MOST POPULAR SUBURBS (by no. sales)
• Parramatta units
Current median: $612,214
Median in June ’25: $693,454
• Wentworth Point units
Current median: $733,181
Median in June ’25: $830,473
• Liverpool units
Current median: $483,454
Median in June ’25: $547,607
• Blacktown houses
Current median: $954,587
Median in June ’25: $1,102,396
MELBOURNE
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CHANGES IN MOST POPULAR SUBURBS (by no. sales)
• Melbourne CBD units
Current median: $491,507
Median in June ’25: $542,216
• Point Cook houses
Current median: $792,134
Median in June’ 25: $930,662
• Tarneit houses
Current median: $666,413
Median in June ’25: $782,955
• Pakenham houses
Current median: $1,291,392
Median in June ’25: $1,517,230
BRISBANE
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CHANGES IN MOST POPULAR SUBURBS (by no. sales)
• Fortitude Valley units
Current median: $470,456
Median in June ’25: $482,614
• South Brisbane units
Current median: $570,450
Median in June ’25: $585,193
• Redbank Plains houses
Current median: $521,124
Median in June ’25: $558,215
• Caboolture houses
Current median: $560,755
Median in June ’25: $600,667
ADELAIDE
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CHANGES IN MOST POPULAR SUBURBS (by no. sales)
• Mount Barker houses
Current median: $591,949
Median in June ’25: $668,869
• Morphett Vale houses
Current median: $540,739
Median in June ’25: $611,005
• Andrews Farm houses
Current median: $458,572
Median in June ’25: $518,160
HOBART
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CHANGES IN MOST POPULAR SUBURBS (by no. sales)
• Kingston houses
Current median: $682,278
Median in June ’25: $825,911
• Glenorchy houses
Current median: $554,653
Median in June ’25: $671,418
• Sandy Bay houses
Current median: $1,369,448
Median in June ’25: $1,657,744
• New Norfolk houses
Current median: $453,732
Median in June ’25: $549,252
PERTH
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CHANGES IN MOST POPULAR SUBURBS (by no. sales)
• Baldivis houses
Current median: $516,500
Median in June ’25: $609,156
• Perth CBD units
Current median: $425,000
Median in June ’25: $501,141
• Gosnells houses
Current median: $420,000
Median in June ’25: $495,344
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