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Property analytics company Cotality has released new data that shows regional dwelling values rose 2.4 per cent over the three months to October 2025 (the October quarter) – the fastest price growth since May 2022.
The quarterly figures beat the May 2022 growth figures of 2.9 per cent, which came just ahead of Australia entering its first rate-hiking cycle in 12 years.
According to the November Regional Market Update, regional growth has been broad-based, supported by improved borrowing capacity, constrained stock, and buyers seeking value outside capital cities.
The recent increase in momentum in the regional markets was led by growth in Western Australia.
Leading the pack for property price gains over the October 2025 quarter were Kalgoorlie–Boulder (+8.1 per cent), Geraldton (+7.4 per cent), and Albany (+6.2 per cent).
In fact, Albany’s dwelling values have grown by 23.3 per cent over the 12 months to October (adding about $136,000 to the $721,253 median value) – the largest increase among the top 50 regional Significant Urban Areas (SUAs).
Mildura–Buronga on the NSW/Victorian border had the fourth-highest property price growth of the regions, with values rising 5.4 per cent over the quarter, followed closely by Toowoomba in Queensland at 5.3 per cent.
Overall, the report shows that of Australia’s largest 50 non-capital SUAs, around 60 per cent recorded an acceleration in the rate of growth over the three months to October, compared to the previous comparable quarter.
The uptick in quarterly growth has been relatively broad-based, with three in five of Australia’s largest 50 non-capital Significant Urban Areas (SUA) recording an acceleration in the rate of growth compared to the three months to July. This widespread lift has seen nine markets record nominal recoveries since July, including Wollongong, Bendigo, and Launceston, all of which have seen values hold below their previous peaks since mid-2022.
Only four regions saw a drop in values over the three months to October 2025. Bowral–Mittagong was down 1.1 per cent, St Georges Basin–Sanctuary Point was down 1.2 per cent, Batemans Bay was down 1.1 per cent, and Bathurst was down 0.4 per cent over the quarter.
Of the top 20 quarterly performers, 19 had median dwelling values below $1 million, with the upmarket Western Australian coastal region of Busselton the only exception at $1,000,130.
Eight of the 16 other regions that recorded double-digit annual growth were in Queensland, three were in NSW, two each were in South Australia and Western Australia, and one was in Victoria.
The Bowral–Mittagong region in NSW recorded the only annual decline in values (-1.2 per cent) and had the longest median selling time at 77 days.
Cotality suggested that affordability was a major factor in the NSW regions, with the Bowral–Mittagong region having the highest median value among the top 50 SUAs, at $1,159,226. (However, it is still 13.5 per cent lower [or $181,901] than its May 2022 peak).
While growth in regional Australian dwelling values continued to trail behind the capitals over the three months to October (which grew 2.9 per cent over the same period), both markets have recorded an acceleration in quarterly growth.
Indeed, Cotality noted that capital cities’ dwelling price growth has been faster as interest rates have eased and the expansion of the Home Guarantee Scheme (now called the 5% Deposit Scheme), which has seen strong demand. The difference has seen the performance gap widen, from just 10 basis points over the three months to July, to 50 bps in the October quarter.
Affordability a growing pull factor
Commenting on the data, Cotality Australia economist Kaytlin Ezzy said the continued uplift in regional quarterly price growth confirms the return of “an upswing phase”.
She noted that while the height of the regional centres’ pandemic surge was driven by remote work, lifestyle shifts, and a desire for space, drivers of the current increase are quite different.
According to Ezzy, the improvements in regional areas could now be attributed to a tightening in supply and renewed buyer activity, following rate cuts and the introduction of the First Home Guarantee.
“Just like the capitals, buyers have become increasingly active across regional areas, with improved borrowing capacity coming up against constrained stock, helping to push values higher,” she said.
“Demand is being shaped less by lifestyle changes and more by affordability, constrained supply and competitive buying conditions in the capitals. The latest results confirm a renewed uplift in value growth across the regions, with buyers seeking value and accessible price points.
“Affordability is certainly playing a part with the strongest growth markets concentrated in regions where a buyer’s dollar stretches further despite scarce stock…
“The top 20 list last quarter is dominated by markets where median prices remain well below the nearest capital city, and that speaks to where buyers are looking for value.”
Looking at some of the boom areas, she said: “As they have done for the past few years, Regional Western Australia and pockets of inland Queensland continue to be some of the best performing areas, but we’re also seeing renewed growth in some that had been flat since 2022.
“WA’s far south-west dominated many of the key indicators, yet momentum hasn’t been limited to one region or one price bracket. Strength is emerging across inland centres, coastal regions and mining-adjacent areas.
“It comes down to where buyers can still find relatively affordable housing options and where stock remains tightly held.”
Looking forward, Ezzy said that she believes affordability will remain a key driver for regional areas into 2026, as demand grows across the middle and lower price points.
A combination of active owner-occupiers and rising investor participation will also continue to place upwards pressure across the strongest-performing regional markets.
“ABS lending data shows that a record level of investor interest is emerging alongside consistent demand from first home buyers and subsequent buyer households,” she said.
“That will continue to have a flow-on effect in regions offering accessible price points and strong returns, which could translate into shorter selling times and more modest discounting in areas where stock is tightest.”
[Related: Buyers driven into town houses amid house price crunch]