The past few years have been a rollercoaster ride for Australian property. Prices soared by +28.6 per cent over the pandemic boom before rising interest rates caused a downturn in 2022. A remarkable rebound that started in 2023 pushed home values back to record levels in 2024 before the broader market slowed once again moving into 2025. 

Monthly price growth on the national level has wound right down after interest rates have been held high for more than 12 months, but impending rate cuts could shake things up once more. Clearly, there's a lot to consider for anybody thinking about listing their home. 

Is it best to take advantage of the current conditions in what broadly remains a seller's market? Or is there value in waiting to see how things unfold over the coming months?

Whether you choose to sell isn’t just about current market conditions, but also the urgency of your own personal circumstances. For some of us, we needed to upsize into a bigger property yesterday, while for others, waiting for the market to rise might be a good incentive to release more capital before retirement. 

Let’s explore the current real estate climate, the pros and cons of waiting versus selling now, and what economists believe is on the horizon for 2024 and beyond.

The current state of the market

According to CoreLogic data, Australia's median property price is still hovering around record highs but hit a plateau coming into 2025.

CoreLogic Australian Home Value Index - January 2025

Sydney and Melbourne are both seeing moderate month-on-month declines after a slow year marked by poor affordability and interest rate pressures. 

Perth, Brisbane and Adelaide all continue to reach new heights after a remarkable run, but the pace of growth has slowed markedly over the past six months. 

Hobart, Darwin and Canberra have been hovering around flat levels throughout most of 2024 and into 2025, while regional markets have collectively regained some strength and are generally outperforming their capital city counterparts. 

On an annual basis, houses have outperformed units, but that trend has started shifting later in 2024 as buyers seek out affordability. Units and cheaper houses are now delivering the strongest performances as our population continues to swell and interest rates remain high. 

Helpful resource: Get a suburb profile for any suburb in Australia

Australian property market forecast

Interest rates have been a key talking point since they began rising in May 2022 and, after many months of flip-flopping predictions, experts seem to have reached a consensus on what's next. 

Inflation figures for the December quarter looked particularly promising, leading many analysts to double down on forecasts of when a rate cut could arrive. 

All four of the big banks have predicted that interest rates will start to decline from February 2025. 

Again looking to the big banks, their latest price forecasts show continued but slower growth than we saw throughout 2024.

Big banks' Australian property price forecast 2025

SQM Research's managing director, Louis Christopher, has a slightly more bullish view of the year ahead, particularly if the first expected rate cut lands early in 2025. 

"2025 appears to have started strongly on the residential property listings front across the country with a 10 per cent rise in total property listings, driven by a sharp rise in new listings," he said.

"If an interest rate cut does occur, we believe this will lift confidence in buyer demand with housing prices expected to rise between 6 to 10 per cent for the year."

KPMG sees 2025 being a year of growth for every capital city market, with units expected to outperform houses across the board. 

"The Residential Property Market Outlook finds unit (apartments and townhouses) prices will gain by 4.6 per cent in 2025 and then 5.5 per cent the following year, as they represent a more realistic route into the housing market, given the ongoing affordability crisis," they said.

What are the upsides in the current market? 

After the major ups and downs of our property markets between 2020 and 2023, things landed in a more balanced place by the end of 2024. 

The most obvious benefit for sellers is that the national median property price is still close to an all-time high. Over a four-year period since the start of the pandemic, the median Australian home value shot up nearly +40 per cent. 

In Brisbane, Perth and Adelaide, that number has soared beyond +68 per cent, meaning the vast majority of sellers who have held their property for even four years look set to make a very substantial profit. 

The ongoing issue of housing undersupply in the face of record levels of immigration is continuing to support property prices despite the high interest rate environment. 

PropTrack explained that "Given the current trajectory, it's unlikely that 1.2 million new homes will be built in the next five years. This means we’re likely to continue to see an undersupply of homes to buy and an undersupply of homes to rent."

More affordable properties, or those that may be considered entry-level, are also delivering above-average gains around the country which may help those looking to upgrade from a smaller house or unit.

"A combination of less borrowing capacity and broader affordability challenges, as well as a higher-than-average share of investors and first home buyers in the market is the most likely explanation for stronger conditions across the lower value cohorts of the market," CoreLogic's Tim Lawless explained.

“The past three months has seen the lowest quartile either record a higher growth rate or smaller decline relative to the upper quartile or broad middle of the market across every capital city except Canberra.”

Ultimately, prices are at or near record levels in many markets across the country, and looking back over the past few years there has been an exceptional level of growth for home values.

See what houses are selling for in your area with a free property report of your local area.

What about investment properties? 

Current market conditions are a bit of a double-edged sword for property investors. 

On the one hand, an extremely tight rental market is providing incentives. SQM Research data shows national vacancy rates still very low at just 1.0 per cent in January, while rental rates have soared nearly +10 per cent per annum over the past three years. 

At the same time, interest rates rose a full +4.25 per cent over just 18 months, driving mortgage repayments far higher. 

How the two forces play out largely depends on an investor's loan balance. Some investors are opting to sell up to avoid inflated repayments, while others with lower or nil balances may benefit from the current rental market dynamics.

Is it a buyer's market or a seller's market right now?

In a city like Perth which is currently seeing stunning rates of monthly price growth, well below-average listings, strong buyer demand, and lightning-fast days on market, it's easy to apply the 'seller's market' label. 

In many other cases, though, the task isn't quite as simple, particularly when looking down to a suburb level. 

Assessing whether a market is balanced or favours either sellers or buyers requires looking at a range of data as well as getting a first-hand feel of what's happening on the ground. 

Some of those key data points include price movements, auction clearance rates, new and total listing levels, sales volumes, average days on market and vendor discounting rates.

But the data can only tell you so much. It's also worth heading along to nearby open homes and auctions to get a sense of what the competition is like on both the selling and buying sides. 

Our simple guide to tracking market trends and data will walk you through everything you need to know to be able to read the market and make a smarter selling decision. 

Should I sell my house now or wait?

If you’re still on the fence about selling, we get it. It’s a huge decision that deserves all your careful consideration weighing up the advantages and disadvantages for either scenario. 

Even if the market feels uncertain, it’s important to remember that it’s all relative and the market doesn’t stop. There will always be properties being listed and buyers out there wanting to purchase a home. 

It's also crucial to recognise that conditions will vary from suburb to suburb, so it’s important to understand your own local market — and to do that, you really need to get granular. 

Whether your property is impacted by price gains or falls depends on many factors including location, property type, and whether your home falls into the higher or lower end of the market.

If you’re seriously considering selling your home, you need to do your research. As a first step, get an estimate of what your home might be worth in today's market. 

Speaking to a top local agent is also one of the best ways to get a thorough understanding of how buyers are behaving in your suburb, what kinds of results are still being achieved, and what the best strategy could be for you to still get that dream sale result. 

At the very least, it’s helpful to hear what properties are selling for, what demand is currently like for homes like yours, and to get a no-obligation appraisal of what your home might sell for in the current market. A top agent who knows your market like the back of their hand will be able to help you along the journey.