Published on and written by Cyril Jarnias
As Australia continues to attract international attention for its economic dynamism and exceptional quality of life, the real estate market remains a key indicator of this growing popularity.
In this article, we’ll dive into price disparities that exist between its major cities like Sydney, Melbourne, and Brisbane. By exploring differences in value per square meter, we’ll highlight current trends and the reasons behind significant fluctuations in these markets.
Get ready to discover the economic and social factors influencing these gaps, to better understand where and why to choose to invest in the Australian real estate landscape.
Overview of Property Prices in Major Australian Cities
Major Australian cities are experiencing contrasting property price trends, driven by specific economic, demographic, and policy dynamics. Here’s a detailed analysis of recent and historical trends, influencing factors, comparative data, and outlooks for Sydney, Melbourne, Brisbane, Perth, and Adelaide.
Recent and Historical Property Price Trends
| City | Median House Price (AUD) | Median Unit Price (AUD) | Annual House Change | Annual Unit Change | Average Price per m² (AUD) |
|---|---|---|---|---|---|
| Sydney | 1,691,731 | 823,467 | +4% | +1.8% | ~11,000 |
| Melbourne | 772,561 | 604,000 | -0.8% | Stable | ~8,000 |
| Brisbane | 1,087,183 | 774,498 | +10% | +16.2% | ~7,500 |
| Perth | 841,928 | N/A | +17.6% | Beginning to decline | ~7,000 |
| Adelaide | 851,125 | N/A | +13.1% | Moderate growth | ~6,500 |
2025 data; prices per m² are estimates based on median prices and average areas, as official sources more frequently publish prices per property rather than per square meter.
Trend Analysis:
- Sydney is hitting new records, driven by a marked recovery since late 2024. After a slight dip, growth is accelerating again, with sustained demand despite rising interest rates.
- Melbourne experienced a downturn in 2024 but is returning to moderate growth in 2025, supported by improved affordability and increased transactions.
- Brisbane continues its strong progression, with a particularly dynamic unit (apartment) market, narrowing the price gap with houses.
- Perth records the highest annual growth, but early signs of slowdown are appearing, especially in the unit segment.
- Adelaide maintains steady growth, although the pace is moderating compared to previous years.
Economic Factors Influencing Prices
- Supply and Demand:
- High population growth, particularly in Sydney and Brisbane, fueled by immigration and economic attractiveness.
- Housing shortages in some cities (Sydney, Perth), amplified by constraints in labor and construction material supply.
- New housing supply struggles to keep up with demand, especially in affordable segments.
- Credit Accessibility:
- Eased credit conditions in 2023-2024 supported the post-pandemic recovery.
- Gradual interest rate hikes are now weighing on borrowing capacity, but the effect remains limited in major metros due to strong demand.
- Local Housing Policies:
- Tax incentives for rental investment vary by state, as do regulations on short-term rentals.
- Initiatives to stimulate new construction struggle to offset demographic pressure.
Comparison of Average Prices per Square Meter
| City | Average Price per m² (AUD) | International Comparison |
|---|---|---|
| Sydney | ~11,000 | Highest in the country |
| Melbourne | ~8,000 | Moderate for a metropolis |
| Brisbane | ~7,500 | Rising sharply |
| Perth | ~7,000 | Catching up |
| Adelaide | ~6,500 | Still attractive |
Outlook (2025-2027)
- Experts anticipate an average national price increase of 3.7% for 2025, with more pronounced progressions in mid-sized cities (Brisbane, Adelaide, Perth: +5 to 8%), while Sydney and Melbourne are expected to grow more moderately (around +3%) in a market normalization context.
- Supporting factors remain population growth, persistent shortage of new housing, and resilience of the rental market.
- Identified risks include a potential faster rise in interest rates or tighter credit access, which could curb demand, especially for first-time buyers.
- Regional disparities are expected to intensify: Perth and Brisbane may continue to outperform, while Sydney and Melbourne should experience more balanced growth but will remain the most expensive markets.
Key Takeaway:
Sydney remains the most expensive city, closely followed by Melbourne. Brisbane, Perth, and Adelaide are seeing their prices catch up thanks to sustained demographic and economic growth, but property access remains relatively more affordable there.
Future evolution will largely depend on the ability to increase housing supply and the monetary policy of the Reserve Bank of Australia.
Good to Know:
In Sydney, property prices now exceed 10,500 AUD/m², mainly due to high demand and limited supply, while in Brisbane, better credit accessibility has allowed for more moderate growth at around 5,300 AUD/m².
Future Trends: What to Expect from the Australian Real Estate Market
Australian Property Price Forecasts by Region (2025-2026)
| Region | 2025 Forecast | 2026 Forecast | Key Observations |
|---|---|---|---|
| Sydney | +4.5% | +5.5% | Most expensive market, strong demand |
| Melbourne | +4.0% | +5.0% | Stable growth, supply pressure |
| Brisbane | +5.0% | +5.0% | Internal migration, demographic dynamism |
| Regions (average) | +3.0% | +3.5% | More moderate but sustained growth |
National prices are expected to progress by an average of 3 to 6% annually until 2026, according to analyst consensus and the country’s major banks. Major cities show increases above the national average, while regional areas remain in growth but at a more moderate pace.
Economic, Demographic, and Policy Factors Influencing the Market
- Interest Rates: High interest rates slowed growth early in 2025, but several cuts are expected in the second half, stimulating mortgage demand.
- Government Policies: Commitment to building 1.2 million new homes by 2030 to address supply deficit, with a focus on social and affordable housing.
- Immigration: Net migration remains high, increasing pressure on housing demand, especially in major metros.
- Infrastructure Projects: Major investments in urban transport (metros, roads, rail links) in Sydney, Melbourne, and Brisbane, enhancing suburb attractiveness and increasing land value in serviced areas.
Urban Growth and Impact on Supply and Demand
- Rapid urban growth in major cities worsens the supply-demand imbalance, particularly in Sydney and Melbourne where supply remains insufficient despite accelerated construction starts.
- Suburban and regional areas are attracting more buyers seeking affordability, supporting their growth but at a more moderate pace.
Expected Differences Between Major Cities and Regional Areas
| Criterion | Major Cities (Sydney, Melbourne) | Mid-sized Cities and Regional Areas |
|---|---|---|
| Price Increase | Stronger (+4 to 6%/year) | Moderate (+2 to 4%/year) |
| Demand | Very strong (immigration, jobs) | Increasing, but more linked to quality of life |
| Supply | Under pressure, massive new projects | Less tight, but construction slowdown |
| Affordability | Very low for first-time buyers | Better, but deteriorating |
Opportunities for Investors and Buyers
- Investors: Major cities remain attractive long-term due to demographic growth and infrastructure projects, but market entry requires significant capital. Industrial and logistics segments also offer solid prospects.
- Buyers: First-time buyers face growing difficulties in metros. Mid-sized cities and regional areas represent an alternative with better affordability, though price increases are gradually reducing this advantage.
Key Takeaway
The evolution of the Australian real estate market will remain positive until 2026, driven by economic recovery, expected interest rate cuts, sustained immigration, and massive public investments. Major cities will experience more dynamic growth, but with sharply declining affordability. Regional areas still offer opportunities, but price pressure is also intensifying there.
Good to Know:
Property prices in Sydney and Melbourne are expected to grow more moderately compared to regional cities, due to interest rates and restrictive government policies, while urban growth and infrastructure projects in these metros could present interesting investment opportunities.
Analysis of Price Gaps Between Australian Metros
| City | Average House Price | Average Unit Price | Price/m² | Recent Annual Change |
|---|---|---|---|---|
| Sydney | $1,722,443 | $834,791 | — | +2.6% |
| Melbourne | $1,063,719 | $573,600 | $604 | +2.3% |
| Brisbane | $1,060,311 | $678,772 | $658 | +2.1% |
| Perth | $954,686 | — | $807 | +2.4% |
| Adelaide | $1,012,335 | $580,631 | $611 | +1.1% |
Price Gaps and Dynamics:
- Sydney remains the most expensive city, with a median house price exceeding $1.7 million. Access is particularly difficult for first-time buyers, steering demand toward apartments, which are significantly less expensive.
- Melbourne shows more affordable prices but experiences strong investor demand taking advantage of a market recently considered undervalued. Units represent a sought-after alternative facing rising house prices.
- Brisbane, Perth, and Adelaide have experienced marked growth, with annual price increases exceeding 10% in some cases, driven by migration attractiveness and limited supply.
- Perth stands out with the highest annual progression (+17.6%) in median price, reflecting a catch-up after years of stagnation and strong demand linked to mining employment and immigration.
Explanatory Factors for Price Gaps:
- Migration and Demographic Demand: Internal and international migration flows strongly influence Sydney, Melbourne, and Brisbane, causing supply tensions and price increases.
- Land Supply and Construction: Urban constraints, availability of buildable land, and slow building permit approvals contribute to scarcity and thus price rises, especially in Sydney.
- Infrastructure: Cities investing heavily in transport, like Brisbane and Perth, see enhanced attractiveness, pushing prices upward.
- Local Housing Policies: Purchase incentives, restrictions on foreign investment, or urban densification create different dynamics across metros.
Testimonials and Case Studies:
- In Sydney, buyers report necessary compromises, opting for apartments or moving away from the center to access property.
- In Melbourne, local and foreign investors are taking advantage of a price catch-up period after several quarters of stagnation, generating upward pressure.
- In Perth, the arrival of new workers in the mining sector has created a housing shortage, with some real estate agents reporting price increases of over 15% in one year in certain neighborhoods.
Long-term Trends and Recent Events:
- Australian metros are experiencing a general trend of sustained increase, with acceleration in mid-sized cities (Brisbane, Perth, Adelaide) and more moderate progression in already highly valued markets like Sydney.
- Recent interest rate cuts and expectations of further reductions have revived demand, despite a high inflation context.
- The shortage of new housing, worsened by pandemic-related construction delays, continues to support price increases, especially in family segments.
Key Takeaway:
Price gaps between Australian metros result from a combination of structural factors (supply/demand, infrastructure, local policies) and cyclical factors (interest rates, immigration, construction delays). The current dynamic favors intermediate markets, but access barriers persist in major cities, especially for first-time buyers.
Good to Know:
Sydney displays the highest property prices, partly due to sustained demand and limited supply, while in Adelaide, prices are more moderate thanks to local policies favoring balanced development. Recent infrastructure improvements in Brisbane have also stimulated the market, making the city increasingly attractive.
Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
