The year 2024 ended with good news for potential Australian home buyers like Madeline, something many had looked forward to over the past few years.

Potential homebuyer Madeline Riseborough says that with the cost of living crisis, her budget keeps getting blown out. Credit: SBS

In December, home values dropped, according to property data providers.

“We have no idea what’s going on.”

Will buying a house be easier in 2025?

“In places like Perth and indeed in a lot of our regional markets, we’re probably not going to see prices decrease,” she told SBS News.

PropTrack’s report shows in 2024, Melbourne experienced the largest drop in home values with a 2.49 per cent decrease, and Perth recorded the largest growth (17.59 per cent).

Here are the changes that potential home buyers need to track in 2025:

Interest rates pushing property prices

Earlier in December, the RBA kept the official cash rate at 4.35 per cent after its final board meeting of 2024. Source: AAP / Steven Saphore

Macroprudential policies to ‘dampen housing activity’

“As we saw through previous periods of credit tightening, such as the macroprudential measures that were implemented in 2014 and 2017… less access to credit would dampen housing activity,” he said.

Less migration will lead to ‘less aggregate housing demand’

“A further reduction in overseas migration will see less aggregate housing demand, especially across the rental sector where rental growth is already flattening out,” Lawless said.

‘More homes for sale, more choices’

“If we look at the trend that we were seeing over the last few months of 2024, we are likely to see more homes hit the market over the start of 2025.”

Potential improvement in housing affordability

“We should see an improvement in housing affordability as household incomes rise faster than housing values and serviceability constraints improve on the back of lower interest rates and an easing in cost of living pressures.”