Home prices lift in most suburbs despite rate hikes as affordable areas outperform

New data reveals home values have continued to climb in most suburbs this year despite interest rate hike fears and global economic turmoil rippling through households.  

House values rose in 70% of Australian suburbs during this first three months of the year, new valuations data from PropTrack has revealed.    

Unit values rose in about 71% of the suburbs with available data, showing cheaper regional markets and outer capital city suburbs posting some of the biggest quarterly gains.  

It comes as home buyers are faced with a worsening affordability crunch amid rising interest rates and living costs, with the global oil shock expected to boost inflation in the months ahead.

The Reserve Bank has already raised interest rates twice this year, with experts predicting at least one more hike is still to come.

REA Group senior economist Anne Flaherty said the growth in home values varied greatly across the country during the quarter, but the affordable end was outperforming the wider market. 

"Home price growth has slowed across the whole of Australia, but we are still seeing some wildly divergent trends, depending on where you look in the country,” she said.  

“One thing that stands out is that we're still seeing outpaced growth at the more affordable end of the market. 

House prices grew in 70% of Australian suburbs during the first three months of the year. Picture: Getty

---

“Given that interest rates are increasing and the cost of living is rising, we will likely continue to see that home price growth moderate, but we will continue to see growth in some of these more affordable pockets outperform.”

Affordable suburbs outperform in 2026

The affordability trend was on show among the country’s home value hotspots, with six out of the top 10 suburbs with the fastest price growth over the first three months of the year having a median home value of less than $1 million.  

The fastest growing suburbs with median house values less than $1 million included Moree in New South Wales, Katanning in Western Australia, Charters Towers City in Queensland and North Beach in South Australia.  

At the top of the list was Gelorup, 10 kilometres south of the city of Bunbury in WA, where the median house value soared 16% to $1,224,687 during the three months.  

Top 10 suburbs for quarterly price growth - Houses

Tim Cooper, sales representative at Summit Realty Bunbury, said buyers were attracted to Gelorup for its lifestyle offering and other features.  

“It offers lifestyle and proximity to the Bunbury centre,” he said. 

“It’s also located next to Dalyellup, which has grown in a commercial sense with all of its infrastructure, schools and shopping. So Gelorup has benefitted from the amenities in Dalyellup.” 

This five-bedroom house in Gelorup in WA sold for $1.38 million in February. Picture: realestate.com.au/sold

---

Owner occupiers have been the main buyers in the area, including locals and Perth buyers looking for a tree change, he said.  

Mr Cooper said there had been a few home sales well above median house price in the Gelorup area during the past three months that had contributed to the spike in the area's median house value.

“The $1.2 million to $1.5 million mark is quite a prevalent price point for Gelorup, and there hasn't been a lot of stock coming up for sale, so supply and demand factors are driving values,” he said. 

Top 10 suburbs for quarterly price growth - Units

Mr Cooper said some buyers were showing a little more caution amid higher interest rate concerns, but he was still optimistic about the market. 

Regional appeal

Regional locations also ranked highly among the suburbs with the fastest rising home values across the country.  

Ms Flaherty said affordability was a major factor for buyers looking in the regional markets. 

This three-bedroom house in Moree in NSW was sold for $613,000 in February. Picture: realestate.com.au/sold

---

“People who are priced out of buying a home in a greater capital city are looking to regional markets,” she said.  

“Increasing job flexibility means there’s more people who can work remotely and it’s enabling more people to have greater options when it comes to where they live.

“We have been seeing population growth in the regions, and as the population grows, there is a need for more goods and services, which also creates new jobs and more opportunities in those markets. 

Over the past 12 months, house values have surged in affordable regional locations such as Townsville in northern Queensland, Ipswich on the outskirts of Brisbane, and the Geraldton region in WA including Rangeway and Spalding.

Top 10 suburbs for annual price growth - Houses

“There is a broad mix of people moving into regional areas, including young families, anyone looking for a more affordable place to live, and older people retiring.”   

Australia’s estimated regional population grew by 1.1% to 10.02 million in 2025, and has jumped 6.3% since 2020, according to the latest figures from the Australian Bureau of Statistics.  

Property market outlook  

Experts are predicting growing economic uncertainty and an increase in homes for sale could see price growth moderate in some parts of the market this year.  

This three-bedroom house in Charters Towers City in Queensland changed hands for $465,000 in January. Picture: realestate.com.au/sold

---

Ms Flaherty said there was a growing probability of moderating home prices in the second half of the year.  

“I think some capital cities will continue to see prices rise overall, but the uncertainty from higher interest rates, the fuel crisis and the cost-of-living crisis is probably going to put even further downward pressure on home prices,” she said.  

“There's also a really large number of properties that were put up for sale over Easter, which can have an impact."

Top 10 suburbs for annual price growth - Units

There were 7.2% more new listings across Australia in March than the same time last year, led by an influx of new properties hitting the market in Brisbane, regional NSW and regional Queensland, according to the latest REA Group Listings report.

At the same time, the total number of homes for sale was down 9.3% year-on-year.

“Buyers are facing a lot of uncertainty at the moment," Ms Flaherty said.

“Most people looking to buy will still be looking to buy, but they might take more time or feel more confident to negotiate prices lower rather than just going in with the most competitive offer off the bat for fear of missing out.”