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The nation’s residential real estate market shows robust growth driven by lower borrowing costs, tight supply and strong investment activity
October 15, 2025 | Staff Reporter | Australia | Property Management
The total value of Australia’s residential real estate market has reached $11.8 trillion for the first time, increasing by $678 billion over the past year, according to Cotality data. Since the first interest rate cut in February, the property markets across the country have reacted strongly to lower borrowing costs and tight supply, with Darwin leading the way for capital growth.
Cotality’s October Monthly Housing Chart Pack showed that national dwelling values have risen 2.2% over the three months to September. The price surge marked the largest quarterly increase since the three months to May 2024, which also saw a growth of 2.2%. The data showed growth rising for the fourth consecutive month, climbing from 3.7% in 2024–25 to 4.8% in the year ending September.
Cotality’s Head of Research, Eliza Owen, said the price growth milestone showed market resilience, though uncertainty remained over further cash rate cuts and inflation’s impact on momentum. “However, if the property market were to continue at its current rate of growth, it’s possible the combined market value could hit $12 trillion by the end of the year,” she said. In particular, the data showed that areas such as Wanguri and Durack in the Northern Territory experienced a growth of 20.1% during the period between February and September.
According to Cotality, the surge in Darwin was a reflection of the blend of relative affordability, low levels of housing supply, and a notable lift in investment activity. Smart Real Estate Director Stewie Martin said that Darwin had seen a lot of growth in the past year, particularly in the northern suburbs and the greater Palmerston region.
“We’ve experienced at least 30% growth in the last 12 months, particularly with free freestanding houses, but the unit and townhouse sector is kind of rapidly starting to get moving in the last couple of months,” he observed.
In addition, the number of days on market has been reduced due to market strength, but agents have still been dealing with heavy workloads because of increased volume. Further, Martin said there was plenty of upside for investors, with median prices hovering around $650,000–$700,000, much lower than other capital cities. “In Australia, we have the highest rental yields as well. Obviously, for agents after almost a decade of a pretty subdued market, we’re now experiencing much higher volume,” he said.
Owen said that the data highlighted a broad trend of Darwin leading Australia’s capital growth, with city home values up 13.4% year to date. “It’s a relatively affordable market, and investors may be taking note of high yields and rapid value increases,” she said.
In the 12 months to September, Brisbane’s dwelling values rose by 8.8%, with Perth seeing a 7.5% increase in dwelling values, while Adelaide’s dwelling values rose 6.2% over the year.
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