Sydney’s median house price has surpassed $1.76 million and is on track to hit the $2 million mark in 2027 or 2028, as experts warn Australia’s housing affordability crisis can only be addressed by cutting immigration.
Australia’s median is approaching $1.3 million after prices surged for the 12th quarter in a row due to tight supply, improved borrowing capacity, a resilient labour market, and solid wage growth, according to the Domain House Price Report.
The Melbourne market also set a median house price record for the first time in four years, Perth’s median hit $1 million for the first time after an $18.4% annual increase, and Brisbane unit prices surged by 19.3%.
Nicola Powell, Domain’s chief of research and economics, told ABC News that while Sydney’s annual price growth of 6.4% was lower than any other capital except Canberra, it was still increasing steadily.
“Even though Sydney house prices didn’t rise as much as some previous years in 2025, the city does see wild price cycles from time to time, so hitting the $2 million mark could conceivably happen in 2027 or 2028,” she said.
Dr Powell described Perth’s growth rate as “extraordinary”, citing strong international and interstate migration, which she said was also expected to increase demand for houses and units in Brisbane until the 2032 Olympics.
Griffith University urban planning lecturer Tony Matthews told The Nightly this week that immigration needed to be drastically cut in order to reduce demand for housing and slow price growth.
“We cannot improve affordability unless we radically reduce demand, and that means having a hard look at the population of the country and how fast it’s swelling year to year and where that growth is coming from,” he said.
“Most of that is not coming from internal reproduction, it’s coming from migration: tricky political questions are outside the discussion at the moment.
“The demand is so high that we can’t deliver the supply to meet the demand without building entirely new cities.”
More than 568,000 immigrants arrived in Australia during the last financial year, according to the latest Australian Bureau of Statistics (ABS) data, putting net overseas migration at 306,000, the third highest intake on record.
Australia’s dwelling price-to-income ratio also hit a record high of 9.2 in the September quarter, according to Cotality, with Sydney’s at 10, Adelaide’s at 9.2, Brisbane’s at 8.8, Perth’s at 7.7 and Melbourne’s at 7.1.
Capital city rents have increased by 43% since 2020, but the latest housing construction data from the ABS shows residential completions fell by 1.5%, with the Labor government now 81,000 homes behind its Housing Accord target of 300,000 since July 2024.
Header image: Sydney (Jamie Davies on Unsplash).
