Australia’s median house price is racing towards $1.3 million after 12 consecutive quarters of growth, as Sydney, Melbourne, Brisbane, and Perth all hit new milestones and affordability rapidly erodes, according to the latest Domain House Price Report.
“It clearly shows that we finished the year with momentum still growing, and strongly,” Domain chief of research and economics Nicola Powell said.
Sydney remains the nation’s most expensive market, with its median house price at a record high of about $1.76 million.
Domain data shows the city’s median house price rose 6.4%, or $105,487, over 2025 to reach $1,759,909 – the equivalent of about $2,028 a week – and every region of Sydney now has a median house price above $1 million.
But Sydney’s market is splitting by property type. House price growth has started to cool as buyers hit their borrowing limits, while unit prices are accelerating. Powell describes this as momentum “rotating” towards units, “clearly being driven by affordability constraints”, as priced‑out buyers pivot to apartments and outer‑fringe houses.
The median unit price in Sydney has climbed to a record $844,390, up 3.2% (or $26,536) over the year. North Sydney–Hornsby led unit gains, with the median up 10.8% to $1,080,000, followed by the Central Coast (up 10.2%to $677,500) and the inner west (up 8.4% to $900,000).
While Sydney grapples with “dwindling pockets of affordability”, other capitals are clocking their own milestones. Melbourne has completed a full recovery, posting its strongest quarterly growth since 2019 and its highest median house price in four years at $1.11 million.
Belle Property head of growth Australasia Nick Boyd describes it as “a real landmark”, adding, “In Melbourne, we had the strongest December in our history as a national group.”
Perth has officially entered the million‑dollar club, with house prices up 18.4% over the year to $1.08 million. Hobart has jumped 10.3% to $767,450, while Darwin, still the most affordable capital, has surged 22.4% annually to $690,900 amid a lift in investor activity.
Brisbane has cemented its position as Australia’s second‑most‑expensive capital for houses, with a median of $1.17 million. Yet its defining story is apartments.
Brisbane’s unit prices have risen for 19 consecutive quarters to a record median of $770,470, after leaping $58,000 in three months and $232,300 in two years. That’s 19.3% growth over 2025 alone, including 8.1% in the December quarter, making Brisbane the country’s fastest‑growing apartment market.
“That’s extraordinary growth in a market which, in only a short few years, has gone from having an oversupply of units to now having a price that’s charging along like a steam train,” Powell said.
Brisbane is rapidly closing in on Sydney’s record unit median, though Powell and Brisbane specialist Damian Hackett both doubt it will overtake Sydney in the long run, citing structural differences and contrasting migration, supply and cost dynamics.
Across the country, prices are being supported by tight supply and improved borrowing capacity.
In Sydney, Powell says record prices reflect a shortage of listings and stronger buyer confidence after three interest rate cuts in 2025.
Policy settings are adding further fuel. The federal government’s expanded 5% Deposit Scheme, is also stoking demand. Treasury expects the scheme to lift prices modestly over six years, and Powell says the shift towards units may already be showing “the impacts of the expansion of the home guarantee scheme”.
Looking ahead, analysts say the path of prices in 2026 hinges on rates.
“If there are rate hikes, they could impact both consumer sentiment and people’s borrowing capacity, which could slow price growth rates,” Powell said.
For those still on the sidelines, the picture remains daunting.
“I think for anyone not already in the housing market, it demonstrates what a struggle it will be now, and how many people will be suffering from that Fear of Missing Out,” Powell said.
Read the latest Domain House Price Report for more information.
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