Availability shrinks as property values extend beyond reach of median earners across capital cities
Just one in five suburbs across Australia now remains within financial reach for average homebuyers, marking the sharpest contraction in affordability in recent years.
Property data released by real estate agency PRD demonstrates this deterioration across all major metropolitan areas, with house ownership becoming near-impossible in principal capitals despite three Reserve Bank rate cuts.
Sydney records only 7.8% of suburbs as affordable for houses, Brisbane 22%, Melbourne 25.2%, and Hobart 34.7%. However, Sydney surpassed Brisbane and Hobart in the number of obtainable unit suburbs.
The PRD Smart Moves: Capital City Edition report for the latter half of 2025 documents widespread affordability erosion throughout the nation's capitals. Several centres have experienced a reduction of half or more in accessible suburbs since the first six months of 2025, notwithstanding three consecutive rate cuts.
The situation for houses demonstrates particular severity. Unit markets present marginally better conditions, though the trend remains negative. Sydney, Brisbane and Melbourne each record slightly over one-third of suburbs as accessible, at 36.9%, 36.7% and 36.2% respectively. Hobart represents a particularly challenging case at 28.2%, despite retaining the strongest proportion of affordable house suburbs nationally.
PRD identified several locations that satisfy criteria relating to affordability, rental performance, amenity standards and scheduled residential development across 2025.
Table: Smart Moves Suburbs for H2 2025
Source: PRD
Brisbane's Slacks Creek represents the optimal selection for houses, demonstrating a median value of $760,000, 2.9% rental yield, and 22 units of forthcoming supply. Logan Central leads the unit category with a median of $425,000, 5% yield and 21 new residences scheduled.
Within Sydney, Merrylands provides the most suitable circumstances for house purchasers, recording a median of $1.31 million, 2.9% yield, and 630 units of pipeline supply. The unit market is dominated by Parramatta, where the median reaches $600,000, alongside 6.1% yield and 1,712 residences under development.
Melbourne's St Albans fulfils the criteria most effectively for houses at a median of $685,000, 3.7% yield, and 155 units of scheduled supply. Box Hill presents the strongest unit prospects at $540,000 median, 5.7% yield and 379 pipeline residences.
Hobart's Warrane serves as the primary selection for houses at a $513,500 median, 4.3% yield, and 10 anticipated supply units. New Town leads unit options at $457,500, 5.2% yield and 44 forthcoming residences.
Dwindling pockets of affordability
According PRD's chief economist, Diaswati Mardiasmo (pictured right), noted that these locations represent the remaining accessible pockets where acquisitions remain possible alongside desirable neighbourhood characteristics and development indicators suggesting sustainable long-term appreciation.
The economist cautioned that purchasers increasingly face displacement to areas beyond the traditional 20-kilometre radius utilised by the report framework, particularly across Brisbane's region. "They're significantly harder to find," she said.
Mardiasmo also indicated that the Reserve Bank is anticipated to maintain interest rate stability until mid-2026 at minimum, potentially placing certain purchasers into a state of cautious anticipation.
"But that pause could give ready buyers a major opening over summer," she said, noting that such a period may encourage elevated vendor market participation and increased property availability.
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