December 2025
Cameron Kusher
This column is designed to give you the inside information on what the latest data shows and what you need to know for your discussions with buyers and vendors.
Here are the top five things to talk with your vendors about:
Interest rates
With a new monthly inflation release by the Australian Bureau of Statistics (ABS) showing inflation came in much higher than anticipated, the Reserve Bank left interest rates on-hold in December.
What was most revealing was that in the press conference following the RBA’s announcement, the RBA Governor stated that she didn’t see any interest rate cuts in the future.
In fact, at the time of writing, cash rate futures pricing has more than a 50 per cent expectation of an interest rate increase by May 2026 and more than a 50 per cent expectation of a second 25 basis point increase by November 2026.
While it looks as if interest rates will be on-hold for some time, the prospect of further interest rate cuts has diminished significantly.
Of course, the outlook can change as the data changes but if you are a vendor waiting for further rate cuts to list and hoping for more buyers as interest rates fall, you may miss your opportunity to see the strongest demand and get the best price for your property.
The cost of housing throughout the state is on the up
In November 2025, Melbourne house prices were 2.7 per cent higher over the quarter and 3.1 per cent higher over the year, reaching $945,000, the highest median price since September 2023.
The median Melbourne unit price reached $640,000 in November 2025, the highest they’ve been in almost three years. Unit prices increased by 1.6 per cent over the past three months and by 1.7 per cent over the past year.
Regional housing costs have increased at an even faster pace with both house and unit prices reaching new historic highs. Regional Victorian houses prices rose 2.5 per cent over the quarter and 4.2 per cent over the year to reach $625,000 and regional unit prices reached $433,000 following a 2.7 per cent quarterly rise and a 3.1 per cent annual increase.
Although Victorian prices are on the rise, relative to other capital cities housing costs in Melbourne remain relatively affordable and are increasingly attracting the attention of interstate investors.
Housing stock for sale is sitting at above long-term average levels
According to the latest listings data from SQM Research, listings of new properties for sale in Melbourne in November 2025 were 10.6 per cent lower over the month but 5.4 per cent higher over the year.
Melbourne had the highest number of new listings of any capital city with 19,779 new listings.
Total listings in Melbourne remain at an elevated level with 41,651 total listings in November 2025, the highest of any capital city and above the long-term average.
Although total listings were elevated, they were 4.7 per cent lower over the month and 8.2 per cent lower over the year.
What this data shows is that more so than elsewhere around the country, purchasers of properties in Melbourne have relatively more choice. This fact has contributed to slower price growth.
Given this, if you are bringing your property to the market, it is imperative that you understand competing stock for sale and listen to market price feedback otherwise it will be difficult to successfully sell in this market..
Properties are selling much quicker than they were a year ago
Despite a relatively high level of stock for sale, properties are selling faster than they were a year ago in both Melbourne and regional Victoria. This is reflected by the fact that price growth has also accelerated over the past year.
In Melbourne, private sales were typically taking 35 days to sell in November 2025 compared to 42 days at the same time last year.
Throughout regional Victoria properties typically take longer to sell at 51 days however, that has fallen from 61 days at the same time last year.
Even though prices are rising and properties are selling quicker than they were a year ago, it remains imperative that vendors set realistic prices on their properties for sale otherwise they can find that these homes sit on the market for much longer than these figures indicate.
Victoria’s economy remains challenged
The Australian Bureau of Statistics recently published its annual State Accounts for the 2024-25 financial year.
The data found that Victoria’s gross state product increased by 1.1 per cent over the year, down from 1.4 per cent the previous year and its slowest growth since 2020-21.
In fact, on a per capita or per person basis, gross state product fell by 0.8 per cent over the past year.
The weak local economy remains a significant challenge for the state and also impacts on the demand for housing within the state.
Here are the top five things to talk with your buyers about.
Price growth is starting to pick-up
There is yet more evidence this month that prices are continuing to climb across the state. Victorian housing remains very affordable relative to other states and that is clearly starting to attract more interest and more competition for quality properties.
Auction clearance rates have increased and there are more people in attendance at open for inspections.
In November 2025, Melbourne median house prices reached their highest median since September 2023 and median unit prices reached their highest median in almost three years.
Regional housing prices have recorded even larger annual gains with median house and unit prices currently sitting at record-highs.
You can’t afford to wait for interest rate cuts anymore, they probably aren’t going to happen
When the Reserve Bank made their interest rate decision earlier this month, they also made it clear that any further reductions in interest rates are unlikely.
Inflation is currently higher than it is supposed to be and is expected to remain elevated for at least next 12 months and there are signs that economic growth is starting to improve. These are not conditions conducive to further interest rate relief.
If you were planning on waiting for further reductions in interest rates to purchase then you are probably going to be waiting a long time and you will miss the opportunity to purchase in the current cycle.
There’s more competition to purchase stock highlighted by higher prices and a shorter days on market
Home prices are rising and at the same time the median days on market has fallen over the past year in both Melbourne and regional Victoria.
Quality properties that are well prices and attracting a lot of buyer interest are selling quickly. We’re increasingly seeing more of these properties coming to the market too.
If you find a property that you like and that you assess to be reasonably price it is important to lodge a competitive offer for that property quickly because you know there will be others also contemplating purchasing the property.
Even though stock levels are elevated the quality properties are being snapped up quickly
The latest listings data from SQM Research showed that in November 2025, the number of new properties listed for sale in Melbourne was 5.4 per cent higher than a year ago.
This highlights an increased willingness to bring properties to the market which is assisted by improved confidence that these properties will successfully sell.
At the same time, the total number of properties listed for sale was 8.2 per cent lower over the year, again reflecting a pick-up in demand for homes.
Stock levels remain elevated but the data clearly highlights that more properties are selling and properties are selling faster than they were a year ago. Appropriately priced properties are seeing ample demand and are successfully selling.
Investors are returning, lured by the affordable prices rising rents and strong rental yields
The most recent data for the September 2025 quarter found that the value of lending to investors accounted for 33.9 per cent of total new lending in Victoria over the quarter.
This was the greatest share of lending to investors since September 2017 and the value was 24.1 per cent higher over the year.
While the increase in taxes on investment properties and other legislation changes have driven some investors out of their properties, Victoria’s relative affordability, strong rental returns are attracting more investors back into the market, particularly from interstate.
If you are trying to purchase a property for investment purposes you are likely to come up against an increasing level of competition for that stock.
You’re also likely to increasingly be competing with interstate buyers who may lack local knowledge and may be prepared to pay more than a local investor is.
Given this, if you find the right investment property to purchase it would be beneficial to move quickly to secure it.
About Cameron Kusher
Over the last 20 years Cameron has worked as a property researcher for major businesses such as PRDnationwide, CoreLogic (now Cotality) and REA Group.
Cameron spent 12 years at CoreLogic as the Head of Research for Australia and 5.5 years at REA Group as the Director of Economic Research. Over the past 17 years he has become a well-regarded thought-leader on the residential property market and delivered thousands of presentations to the industry, customers and consumers.
He is passionate about taking complex economic and property insights and making them easy for anyone to understand, free of the jargon that most economic and property presentations tend to contain.