Australia’s Property Market Update 2025: Interest Rate Cuts, Property Prices & Where to Buy

By Molly Benjamin, Founder of Ladies Finance Club

Listen to the full podcast here.

The Australian property market is shifting once again, and this time the headlines are all about interest rates. With the latest cuts announced, buyers and investors are asking the big questions: Will property prices rise? Is it a buyer’s market or a seller’s market? And where are the next growth areas across the country?

In this episode of Get Rich, I sat down with Arjun from InvestorKit to unpack what these changes mean for everyday Australians and investors alike.

Interest Rates and Sentiment in the Property Market

The first thing to understand is that interest rates don’t always move property prices in a straight line. While many assume falling rates equal rising prices, history shows it’s more complicated.

For example, during previous rate cuts between 2012 and 2019, Sydney and Melbourne surged while Brisbane and Adelaide stayed quiet for years. On the flip side, recent rate hikes didn’t stop Perth, Adelaide, and Brisbane from booming.

So what makes the difference? According to Arjun, it’s sentiment. Lower interest rates may not drastically increase borrowing capacity, but they create confidence. When buyers believe conditions are improving, they act and that belief alone can spark demand.

Buyer’s Market vs. Seller’s Market in 2025

So where do things stand today? Australia currently has a mix of both:

• Seller’s markets remain in smaller capitals and parts of regional Australia, where housing supply is still tight.
  
• Buyer’s markets are emerging in areas like Melbourne’s outer north and east, as well as regional Victoria. After years of little or no growth, places like Mildura, Bendigo, Albury-Wodonga, and Dubbo are seeing renewed buyer interest.
  

The difference comes down to supply. Where listings remain well below five-year averages, sellers still hold power. But in oversupplied areas, buyers are regaining control.

Growth Areas to Watch: Where Property Prices Are Rising

When it comes to growth areas, Arjun highlights two types:

1. Price Growth Hotspots
   
• Queensland: Townsville, Rockhampton
  
• Western Australia: Geraldton, Bunbury, Perth
  
2. Sales Activity Growth
   
• Regional Victoria and NSW: More properties are selling faster and with less discounting.
  
• Outer Melbourne suburbs: Buyers are returning, creating confidence for future growth.
  

Sales activity often signals where investment properties may perform well in the next cycle.

Real Estate Advice: Should You Use a Buyer’s Agent?

Many buyers know exactly where they want to purchase, but is it worth engaging buyer’s agents if you already have a suburb in mind?

Arjun’s advice is clear: come in with ideas, but keep an open mind. While personal research is valuable, professionals use national data, analytics, and portfolio strategies to remove bias. This broader view ensures you don’t miss opportunities in markets you may not have considered.

Portfolio Strategies: Diversification Is Key

For investors building a long-term strategy, diversification matters more than chasing the latest hotspot.

• Clients who started in Queensland, WA, or SA are now being guided toward NSW and Victoria for balance.
  
• A holistic portfolio strategy ensures investors aren’t overexposed to one market, reducing risk and maximising long-term returns.
  

This is why having expert real estate advice can be invaluable, it’s not just about the next purchase, but how it fits into your overall investment property journey.

The Australian property market is full of moving parts. Here’s what to keep in mind:

• Interest rates influence sentiment more than borrowing power.
  
• We’re in a mixed buyer’s market and seller’s market depending on location.
  
• Growth areas are emerging in regional Victoria and NSW, while Queensland and WA remain hot.
  
• Using buyer’s agents and building strong portfolio strategies can help you avoid costly mistakes.
  
• Don’t let timing fears hold you back, staying out of the market for too long can cost you far more in missed growth than you might realise.
  

Whether you’re buying your first home, adding to your investment properties, or looking for smart real estate advice, 2025 is shaping up to be a year of opportunity for those who plan carefully and act with confidence.

Plus, a huge shoutout to our sponsor, InvestorKit! Australia’s #1 Buyers Agency for 2023 and 2024. They specialise in helping investors find high-growth properties utilising industry leading AI and data driven research process across Australia. 70%+ of the properties they purchase are off-market and they have consistently outperformed national average capital growth rates by over 49%. Whether you’re looking to build your property portfolio or secure your first investment. Check them out here.