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

 Interest rates have just been cut - so what does that mean for property prices in 2025?

In this episode, Molly Benjamin is joined by property expert Arjun Paliwal (InvestorKit) to break down the latest housing market update. From rising regional hot spots to whether it’s a buyer’s or seller’s market, this is your essential property investing guide for 2025.

Here’s what you’ll learn:
🏡 How interest rate cuts are shaping property prices (and why it’s not always straightforward)
📊 Buyers vs sellers: which markets are heating up and which still favour buyers
🌏 Best places to buy property in Australia right now (Queensland, WA, and surprising regional towns)
💡 Whether to turn your first home into an investment property or sell and upgrade
📈 Why market sentiment and sales activity matter just as much as borrowing capacity
💰 What property investors should do before buying or selling in 2025

Whether you’re a first-time buyer, upgrading your home, or building a property portfolio, this episode gives you the data-driven insights to make smarter property decisions in 2025.

This episode is brought to you by 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.

CHAPTERS

00:00 – Welcome to Get Rich & Molly’s Money Mission
01:24 – Interest Rate Cuts: What They Really Mean for Property
02:30 – The Power of Sentiment in the Housing Market
03:17 – Buyer’s Market or Seller’s Market?
04:16 – Regional Shifts: Where Buyers Are Returning
04:56 – Biggest Growth Cities Right Now (QLD & WA)
05:32 – Sales Activity Growth: Why Transactions Drive Confidence
06:21 – Can You Choose Your Suburb with a Buyer’s Agent?
08:23 – Building a Holistic Property Portfolio
10:19 – How Long Does It Take to Buy After Pre-Approval?
12:06 – Should You Keep or Sell Your First Home? (Accidental Investors)
13:57 – Gordon’s Story: Sydney Unit vs Toowoomba House
15:30 – Future Property Price Drivers Beyond Interest Rates
16:46 – Why Falling Rates Can Signal a Weak Economy
18:36 – Selling First or Buying First? The $50K Waiting Mistake
21:33 – Too Many Options = Paralysis: Why Strategy Matters

LINKS FROM THE EPISODE

Arjun’s Property Podcast – The Property Nerds: https://www.investorkit.com.au/podcasts/

CONNECT WITH ARJUN PALIWAL

Website: https://www.investorkit.com.au/
Instagram: https://www.instagram.com/arjpaliwal/
LinkedIn: https://www.linkedin.com/in/propertybuyersagent/
TikTok: https://www.tiktok.com/@investorkit

CONNECT WITH LADIES FINANCE CLUB

Join our free Facebook group - Ladies Finance Club Money Chat
Website: https://www.ladiesfinanceclub.com/
Instagram: https://www.instagram.com/ladiesfinanceclub/
LinkedIn: https://www.linkedin.com/company/ladies-finance-club/

TAKEAWAYS

• Interest rates don't directly dictate property prices.
• Sentiment plays a crucial role in market movements.
• Current market shows both buyer's and seller's dynamics.
• Growth is seen in specific regions like Queensland and WA.
• Buyer's agents can provide valuable insights and data.
• Holistic portfolio strategies are essential for investors.
• The buying process typically takes two to four months.
• Becoming an accidental investor can lead to opportunity costs.
• Future property prices will be influenced by supply and demand.
• Acting based on capability is more important than timing.

SOUND BITES

"Don't come in close-minded."
"It's all about holistic portfolios."
"Surround yourself with a great team."

TRANSCRIPT

[00:00:00] Molly: Welcome to Get Rich, the podcast that helps you do just that. Get rich and stay rich. Hey, I'm Molly Benjamin. I'm the founder of Ladies Finance Club, one of Australia's largest financial education platforms for women. But before I started helping thousands of women take control with their money, I was a hot financial mess when it came to my own finances and not the fun kind of hot, more like crying in a supermarket, wondering where all my money went kind of hot.

[00:00:29] But here's the thing, if I can go from financial mess to owning a share portfolio, investing in property, and building wealth. Then you can too. My mission is simple to make women rich because when we have financial freedom, we have choices, confidence, and control over our future. Every week on Get Rich, I sit down with some of the best experts in the industry to break down how we can all start investing, growing our money, and creating long-term financial security without the jargon, boring bits or overwhelm.

[00:01:02] Because when women get rich, we don't just change our lives. We change the world. So if you're ready to start making some smart money moves, hit that subscribe button and let's get rich together. We've got Arjun here for another property update. Now, Arjun, at the time of recording this podcast, we have just found out that interest rates have dropped.

[00:01:24] How do you expect these recent interest rate cuts will impact the property market?

[00:01:30] Arjun: Well, the impact is gonna be pretty big, but not in the way everyone expects it to be. So I want to take a step back and talk about interest rates. Interest rates aren't what everyone seems to think it is, like people think interest rates go up, prices come down, interest rates go down, prices go up, and it's not that simple.

[00:01:48] For example, interest rates went up for the last few years and Perth, Adelaide, Brisbane, many parts of regional Australia boomed well beyond their long-term averages. Then at the same time, interest rates went down between 2012 and 2019 quite aggressively, and 2021 actually extend that further, and during that decline of interest rates, it wasn't until 2019.

[00:02:12] That Brisbane, Adelaide, and Perth even picked up. So they were quite for seven years, while interest rates declined substantially, and Sydney and Melbourne did quite well. So the first thing to say there is don't assume one or the other is the way markets move, but how it will shape markets this time around is the power of sentiment.

[00:02:30] And I think what people underestimate is someone thinking that because interest rates will go down and all these things will happen. Mm-hmm. They will want to act, they will talk about acting, they will say to others, get in the market, they will spread this word. And I feel if I've learned anything from COVID and all the recent events that have happened in the.

[00:02:50] Property investing world, it's don't underestimate the power of sentiment, just people believing something, people thinking something, people acting on something. And that's the way interest rates will impact things more. Because even though borrowing capacity increases, Molly, it doesn't increase as much as people think.

[00:03:04] 'cause there's still something called debt to income ratios. Not just, uh, how much the cost of money is. But I think the sentiment's gonna shift things this time around 'cause of, uh, the interest rates not impacting all markets as badly when interest rates increased.

[00:03:17] Molly: Great. And would you call it a buyer's market right now or a seller's market?

[00:03:23] Arjun: We have a bit of both happening across Australia right now, so we've got sellers markets in our smaller capital still. We've got markets in around regional Australia where it's a sellers market, and it's all really to do with housing supply because housing is still not available as much as people think.

[00:03:40] Yeah, we've got listings across most cities that are well below five-year averages. Apart from our bigger cities like Sydney, Melbourne are actually quite well supplied. They're not under supplied, but when it comes to some other places. Established houses for sale. It's quite undersupplied, so that's the first thing to look at.

[00:03:57] Mm-hmm. Where it's a seller's market though, is places that haven't done as well in recent years. Outer rings of Melbourne in the north and east side, in particular, regional Victoria. We're starting to see a major shift in them. They used to be buyer markets the last two years, but what we're seeing now is.

[00:04:16] Buyers returning because they believe that they're gonna turn around. They believe that these markets have been priced well because they haven't grown in many years. And so markets like Mildura, Bendigo, Albury, Wodonga, Dubbo, we're seeing renewed activity in this city, these cities like we just haven't seen before.

[00:04:35] It's pretty wild. And so I think this is to do with the affordability in these cities and also the recovery that's expected.

[00:04:43] Molly: Okay. Interesting. And I know you just touched on a few areas there, but I guess where, what you are seeing, like which areas in Australia are for like the last, you know, few months seeing that most like that big growth?

[00:04:56] Arjun: Yeah, look, I'll talk about growth in two ways. So if I talk about actual price growth, yeah. The biggest price growing cities are still in Queensland and wa. So if we look at wa, it's Geraldton, Bunbury and Perth. If we go over to Queensland, it's Townsville, Rockhampton, as an example, as two standout cities.

[00:05:17] Yeah. And so when you see those two, when I say heat, it's price growth there and, and that's the growth part that I wanna talk about. But then I'll talk about another type of growth. The other type of growth is called sales activity growth. Okay. Sales activities, just how many people are buying and selling.

[00:05:32] And when that number ramps up, it gives buyers and sellers a different sense of confidence. Like sellers start to go, Ooh. They sold it really quickly, like 10 days rather than 30. Or you see four or five people down in the suburbs sold it, all people from interstate, there's something in the air or there's people who are local are upgrading and buying.

[00:05:51] The main thing is transaction activity drives confidence if it's happening faster and if it's happening with less discounting. Yeah, and these trends are occurring across those cities. I named in regional, Victoria Regional New South Wales. And outer parts of Melbourne. Mm-hmm. And so the more and more these things occur, then you're gonna see future price growth come there.

[00:06:12] But it just hasn't boomed there just yet. But I think that's where future price growth is really looking strong and active because of that recovery and activity.

[00:06:21] Molly: Great. Now I've been speaking to some LFC ladies and they're very determined that they know the area they want to buy. Can they still go to someone like investigate like a buyer's agent and say, Hey, can you guys buy for me, but I wanna buy in this specific suburb or this specific area?

[00:06:42] Arjun: We get that quite often, so it's a good question. We do have people come in with thoughts around, this is where I want to go. There is nothing wrong with that. All I would basically say is don't come in close-minded. Yeah. Because remember, you are coming in with a few podcasts, a bit of research, a bit of lunchtime, scrolling, a bit of weekend review.

[00:07:01] That is the most common way people decide markets. It's not saying everyone does. Yeah. But then how a professional team say like ours at investigate decides on markets. We have data scientists, we have research analysts, senior research analysts. We spend more than half a million dollars each year just on analytics alone.

[00:07:18] We pay some of the largest data companies in the country, the most elite level subscriptions and industry inside information to be able to gain the access first to data. Yeah. And so when that happens and you're nationally operating, it means we have no bias. Yeah, if Darwin's the market of today, we'll be able to say it is or it isn't.

[00:07:36] If it's, uh, you know, Western Australia or Queensland, there's no bias. So rather than let the unfortunate thing that happens to too many Aussies, your own bias takeover of a couple of things you've seen or heard in a form, in a non formulaic process, I would say come in with that information. Feel confident if that's how you feel.

[00:07:57] No stress, but then. Have the conversations, the experts see what it all says, and if you still feel the same, then we can say, well, yeah, we could do that, or we can't. And that's where it will go from in terms of the best way to approach six.

[00:08:12] Molly: Nice. Okay. And I guess from the last few months, like where have you guys been doing most of the buying for your clients?

[00:08:19] Or does it really range and depend on what the client's after?

[00:08:23] Arjun: So firstly, we are all about holistic portfolios. So that means the portfolio in front of us is what matters most. Not about the analytics in isolation or where we are buying. Right. And it's quite different to a lot of buyer agents because we are a national company.

[00:08:37] We're able to say, Hey. We've got the whole country available to us. Mm-hmm. We'll go where a combination of your portfolio needs it, but we'll also bring you the analytics just to make sure we're not going in two opposite directions and it's. One thing that's not data driven, one thing is we wanna have data and your portfolio come together.

[00:08:56] So that's the first part. Yeah. Now, as a result of people's portfolios, and a lot of our clients being repeat clients mm-hmm. We've purchased for clients over the last few years prior in the likes of Queensland, WA and SA, which is produced Phenomenal results. Yeah. And so the biggest thing that helps us produce ongoing results, though.

[00:09:16] Is portfolio diversity. Mm-hmm. And so what does that mean? Those clients who are repeating, we are now targeting New South Wales and Victoria as a core focus. 'cause to us it's like, Hey, you've done well there. You've got some good growth. They're gonna keep on going from the data that we're seeing. And if you haven't got stuff in those areas, maybe they can be great areas still for continued growth.

[00:09:36] But if you want to come into some new cycles and diversify, then we can come through this way. So I would say holistic portfolio guidance. New South Wales and Vic is picking up a lot, but at the same time, it's all about, uh, having the whole country's look and feel before we decide what's next.

[00:09:53] Molly: Nice. Um, that's great that you guys are national, so you do have that kind of, you're not just like stuck on one state and I guess.

[00:10:02] If someone's got their pre-approval, so the bank said, okay, we're gonna lend you, you know, 800,000 once they come to you guys, generally, how long can that process take to go from, okay, we're gonna start looking and now we're handing over like you're getting the keys.

[00:10:19] Arjun: Yeah, the first two weeks is spent in building your strategy.

[00:10:22] Yeah. So this is about getting a clear roadmap for where you are today, where you're trying to get to and reverse engineering that all. Yeah. Then from the following, two to four months is the time to search, present, secure, and exchange on a property. During that two to four months, you may at worst case, refresh your preapproval once more.

[00:10:44] 'cause every 90 days that that's suggested to refresh or you get something before you need to refresh it. But that's the typical timelines. Yeah. And so with this two to four months, what makes it faster or longer in that period is just two things. How many assets does your portfolio have? If it has a fear for your properties already, you're gonna reduce the number of markets we look at.

[00:11:05] 'cause we want to keep getting diverse so it'll take longer. Or the second part is how open your budget and criteria is. So for those who are open to wait, I don't mind changing a carpet or changing some lines and refreshing a house maybe with five to 10 K. And it goes a long way. And at the same time, my budget's between six 50 to eight 50.

[00:11:26] You are gonna be in that closer time period and sooner time period because of those things. But if it's a smaller budget, if it's uh, you know, maybe a little bit more tidy of a home needed because of the tighter budget and the, the tighter cash, then all that just means is it's maybe trending towards a three or four month.

[00:11:43] That's kind of my thinking there.

[00:11:44] Molly: Yeah. Awesome. And we actually had this question straight from an LFC member and she has got a property, she owns that one property, and now they're deciding whether they turn their property into an investment property and buy somewhere bigger for their growing family, or do they just sell that property and buy somewhere new?

[00:12:06] Now, I know it's very much dependent on like the individual circumstances where the house is, but would you have any general advice? For this person. 'cause it's actually, I've had this conversation with this one lady, but I've heard it again and again where people are like, do I turn my current home into an investment property?

[00:12:24] Arjun: Yeah, so there's a few things to consider here. The first is, this is what you call becoming an accidental investor. Yes, and an accidental investor has some dangers to it, and it all depends on where you are in your journey. The first danger is that most people, not all, will typically buy their first home as a stepping stone.

[00:12:44] And that stepping stone property might be their entry into a market Example, a unit in Sydney, a unit in Brisbane or Melbourne. Now there's emotional attachment. There's a roof over their head. There's great satisfaction from ticking the big Aussie goal of getting my own place, and that's killer. It's awesome, right?

[00:13:01] But what ends up happening, the downside, is that you end up not wanting to let it go. It wasn't searched for as an investment, and you're now utilizing and keeping borrowing capacity used and you're trying to upgrade to another investment or a bigger home, and you think that's gonna be a performer. Now, if it doesn't perform like most units across Australia have, then what will happen is that you'll end up having a lot of opportunity cost, right?

[00:13:28] Mm-hmm. And so what you need to do firstly, is take a step back and then be able to go. With a professional team on my side and a strategy team on my side, can they evaluate how's my place at the moment? Do you feel like this is one to keep as an investment or this is one to sell? And so when you are looking to grow a portfolio with our team, yes, we're looking to purchase the next, but when we purchase the next, we also look at helping you with the current.

[00:13:57] And when we are looking at the current, we're commonly seeing units are holding people back. And I'll give you a perfect example of one particular person that comes to mind. Gordon recently reached out to us, and when Gordon reached out to us, he had a property in Alexandria unit for I think just under 600 K.

[00:14:14] Mm-hmm. And this unit was purchased some years back. And that's six years, seven years actually now. And it's only worth six 40 after seven years. Wow. And so it was a very small unit, an older one, uh uh, but a great area. The coffee's good, the vibes are good. The, the proximity's good. You couldn't complain on paper.

[00:14:31] It looks amazing. Right. And at the same time, we'd purchased him a property in Toowoomba in 2021 for $680,000. Today it's worth $940,000. Yeah. And so three years later, three and a half years later, two completely different outcomes. Now, what happens if in 2021 he did decide to sell that? Listen to that guidance and then be able to go, well, I'm now gonna purchase two of those Toowoomba places.

[00:14:58] There is almost an extra $300,000 of opportunity cost. So for this person here, I would basically say, let's look at your investment from a data perspective. Yeah. Are we talking opportunity cost or are we talking This is a great market. 'cause the flip side is what if you're in Newcastle, you'd bought a home that's now, I believe, gonna go through a bit of recovery and that home's too small and you're now moving out.

[00:15:19] That's a great one to keep as an investment because you know, it's a house, you know, it's a recovering market. So this really, it depends, but we look at the research for your first property before we decide what to do with it.

[00:15:30] Molly: Gosh, that is such good advice right there. And I guess apart from the interest rates, what do you see maybe in the future that might affect property prices?

[00:15:42] Arjun: Okay, so right now I think the, right now the big thing that's happening is supply levels have not yet returned in some of our smaller capitals. Okay? And so if eventually people decide to cash out, then what's gonna happen is that they're gonna see these five years of gains. They want to cash out on some of those gains, and they wanna start testing the market.

[00:16:04] Now what will happen there is if the supply returns to some of those very undersupplied markets, it's all about where that money moves next. Because if the supply returns price growth will dampen some of those markets that have boomed a lot. Yeah. But secondly, there's a lot of cash that's gonna happen.

[00:16:20] Where's that money gonna move? And I feel right now across Australia, the 800 K to 1.5 million plus price point in our affordable capitals. And then in our bigger capitals, the 1.5 to 3 million plus price points, it's an interesting space to be in. And the reason why I say that is they have not grown as much as the more affordable markets have over the last four years.

[00:16:46] And so if over the last four years those affordable markets trend kept on continuing for the next four, you'd basically have. I know this is exaggerating it, but a Penrith would be the price of a Bondi. Do you know what I mean? And, uh, it just doesn't happen. So what I'm trying to say there is that we're gonna see some people cash out at some of these higher growing markets that are being affordable rings.

[00:17:07] Yeah. And they'll look to upsize to middle ring in a ring areas and basically look to buy markets that haven't done as well, but it feels like a good value exchange for them. So that's one trend I anticipate happening. It's already happening in Perth. We're seeing people in the 15 kilometer ring of Perth, their price points are starting to pick up now, whereas they were a bit slow over the last few years whilst the rest of outer ring Perth boom.

[00:17:33] So that's one trend. The second trend I'm gonna highlight is interest rates. Declining is also a sign of a bad economy, and if you break down the drivers of GDP growth, it's really just government. Spending that's driving Australian GDP growth, which means the economy at a macro level isn't super strong.

[00:17:55] And so interest rates are kind of that, that stick that you're prodding to go can, okay, can you do something now I'm gonna, I'm decreasing it. I'm tap and it's just every decrease, there is more prods to kind of go, can you wake up now? And hopefully this activity does come back. But the problem is that more and more continued interest rate declines is essentially us just saying unemployment's increasing, not much activities happening and things like that.

[00:18:20] So you hope for that recovery to occur. Some exciting innovations and exciting job creation. Some greater job market times. 'cause if that all keeps happening and interest rates don't come down. Too low. Mm-hmm. Then we've got a real healthy balance of tight unemployment, good jobs, and it's actually local economies that drive markets the most.

[00:18:41] Local economies, local supply. If those two things are strong, you've got strong housing markets and good price growth.

[00:18:48] Molly: Love it. And final question again, this came from a session we did the other night and I noticed a lot of people in the chat were talking about, I'm trying to sell a property and then I'm gonna wait and see if I can find something good to buy.

[00:19:02] And for me, that sounded a little bit red flag because when people wait. To buy. That's when they can absolutely miss out. And we've heard countless stories where people have just waited, you know, a year too long and then they haven't even been able to get back into the market. So for people who are maybe thinking, I might just sell now and then see if I can find something later, rent in between.

[00:19:21] What advice would you have for them?

[00:19:25] Arjun: I've got two pieces of advice here. The first one is if you plan to turn to be a rent investor, great, because now you can sell a home that might not be as data driven and you're able to rent and then you can immediately get back into the market. But nationally as an investor.

[00:19:42] Data driven. So if you're doing that, great, but don't let time be your deciding factor. Let capability be the deciding factor. So if you sell, can borrow, have the cash, and then can do it. Like just go and make a boring checklist. Can I borrow? Can I have the SA savings and cash for it? Do I have options in the market?

[00:20:02] Does my budget work in the markets being nationally? And then lastly, can I handle one to two or two to three K per month of my savings being reduced each month because of negative cash flow today in Australian interest rate environment? And so if you can, that's a checklist to say, go and do something.

[00:20:19] Don't let your one year, your six months and see what's happening. There is a market somewhere out there, like remember, there are 550,000 transactions in Australia that happen every single year. So whether you think the market is doing something or not, it's doing something. It's just somewhere is doing better than elsewhere.

[00:20:37] Yeah, so that's the first part of your plan is to go to rate vesting. If you plan to actually buy another place, I prefer to flip it the other way. If your condition allows it to, and I say conditions, it means lending conditions. Mm-hmm. To buy something, get a longer settlement, and sell yours in between.

[00:20:55] That's what I've done for my last two home upgrades. Mm-hmm. We bought our dream home. We had to sell two homes to get their dream home, but we had a four month settlement for our dream home. Sold the other two homes within that four month period. Wow. And then we were able to purchase that dream home and not lose any time in the market.

[00:21:14] Now that does present some risks of what if it doesn't sell the timing, it gets a pretty tight, so risk appetites there. But there are some companies and banks that now also do bridging finance. So you could consider that, which is essentially a way to make those risks lower. But um. Alternatively, if you are selling first mm-hmm.

[00:21:33] Go for it. But don't have that delay in lag only because even at a boring 5% compounding growth rate, mm-hmm. Any million dollar asset is $50,000 lost in every year that you wait for it. Right, and we all know how hard it is to save 50,000 and save. It isn't easy no matter what income you're on. It is hard to keep that level of cash away.

[00:21:56] And so as a result, it's important just to make sure that you don't let the market take that cash away from you in lost growth. And you act soon when you know you're in that capability. And I think the biggest problems people have is they just don't know where. Yeah, and as a result, they're constantly thinking and uming and eyeing, and there's so many options.

[00:22:15] I'm realizing it as well. In recent times, we've been dealing with over the last 12 months more high value clientele than we've ever had before, and funnily enough, you think that they've got their life all sorted, but with higher income people, I'm noticing they have more options. And more paralysis. Yeah.

[00:22:32] Than ever before. And so I feel like more options is what hurts people. And then when you dunno a process to crunch down the data and information, you get stuck. And that's where we can come in as a team and just help people get that sort of like transparency of what's happening out there and be able to just think it through and have clear options.

[00:22:48] Molly: Yeah, absolutely. And I, I hear that so often. I just dunno where to buy. Well then surround yourself with a great team with that strategy piece, which is so important that I think gets skipped out so much in these conversations. So guys, we've had Arjun here from Investor Kit. We'll pop all his details in the show notes.

[00:23:06] Where you can get in touch with the team. But thank you so much, Arden, for coming on the podcast and giving us a property update.

[00:23:13] Arjun: Absolutely. Anytime.

KEYWORDS

interest rates, property market, buyer's market, seller's market, growth areas, buyer's agents, portfolio strategies, investment properties, property prices, real estate advice