Are Regional Property Markets the New Powerhouses in 2025?

In January 2025, according to CoreLogic, Australia's housing market showcased a tale of two trends: while national dwelling values remained relatively unchanged, regional areas surged to new record highs.

National Overview

The national dwelling values experienced a slight decline of 0.03% in January. This stability was influenced by a 0.2% drop in capital city values. Notably, Melbourne saw the most significant decrease at -0.6%, followed by the ACT at -0.5% and Sydney at -0.4%. In contrast, Hobart maintained its position with no change in values for the month.

Regional Australia's Remarkable Growth

Regional markets continued their impressive performance, with dwelling values across combined regional areas rising by 0.4% in January, setting new record highs. This growth underscores the ongoing demand for properties outside the major capitals.

Capital Cities: A Mixed Bag

• Brisbane and Perth: Both cities recorded growth in home values. However, there's a noticeable slowdown in momentum, especially in the detached housing sector. For instance, Perth's growth rate decreased from 7.1% in the June quarter of 2024 to just 1.0% in the three months leading up to January.

• Adelaide: Demonstrated resilience with a 4.8% gain over the past six months, leading the capitals in value growth. Despite this, the pace of gains is showing signs of slowing.

Annual Growth Trends

Over the past year, national home values have seen growth more than halve, dropping from a 9.7% peak in February 2024 to 4.3% in January 2025. Cities like Melbourne (-3.3%), ACT (-0.5%), and Hobart (-0.4%) experienced annual declines. Meanwhile, Sydney recorded a modest annual gain of 1.7%, marking its lowest since June 2023. On the regional front, Regional Victoria was the only area to see a decline over the past 12 months, down -2.6%.

What Does This Mean for You?

For homeowners in regional areas, this surge in value is promising, potentially increasing equity and investment opportunities. Conversely, those in certain capital cities might face challenges due to declining or stagnant property values.

For buyers, especially first-time entrants, regional markets might offer attractive opportunities given their upward trajectory. However, it's essential to approach with caution, ensuring thorough research and understanding of local market dynamics.

For sellers in declining markets, strategic planning is crucial. Consulting with real estate professionals can provide insights into optimal selling times and pricing strategies.

Considering your next move in this evolving market? Let's discuss how these trends impact your property goals and explore tailored strategies to navigate the current landscape.