Smart Moves Capital Cities Edition: 2nd Half 2025

The latest Smart Moves reports unpack how three cash rate cuts this year have reshaped Australia’s property market. For investors, we spotlight suburbs with strong rental yields and low vacancy rates both which are prime indicators of high-return opportunities.

Planning ahead? We’ve analysed housing stock supply for 2025, including ready-to-sell properties and land lots, so you know where the new developments will be. If you are seeking affordable alternatives to inner-city living, these guides highlight suburbs that tick all the boxes, factoring in affordability, investment potential, liveability and future growth to give you the best options for buying smart in Brisbane, Sydney, Hobart and Melbourne.

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PRD Smart Moves Brisbane Metro 2nd Half 2025
PRD Smart Moves Hobart Metro 2nd Half 2025
PRD Smart Moves Melbourne Metro 2nd Half 2025
PRD Smart Moves Sydney Metro 2nd Half 2025

Key Findings

• Units continue to provide more hope for first home buyers in Sydney, Brisbane, and Melbourne. There is a stark contrast between the percentage of affordable suburbs in Sydney for houses, at 7.8%, and units, at 36.9%. Brisbane also shows a stark contrast, with 22.0% of affordable house suburbs and 36.7% affordable units. Hobart remains the exception, with more affordable house suburbs (34.7%), than affordable unit suburbs (28.2%).
• This is the first time that unit buyers in Sydney, Melbourne, and Brisbane have a similar opportunity for affordable unit suburbs, at 36.9%, 36.2%, and 36.7%, respectively. There has been a decline in the number of affordable unit suburbs in Brisbane, Melbourne, and Hobart, which suggests that now is an ideal time for first home buyers to enter the market.
• Compared to the 1st Half 2025 report, the percentage of affordable suburbs has declined for all capital cities and almost all stock types. Surprisingly, the exception to this is Sydney, where the percentage of affordable house and unit suburbs has remained stable. 38.7%.
• In these reports, like the previous, we had to sacrifice the unemployment rate in favour of ensuring a reasonable amount of ready-to-sell housing stock projects (most of which are units), and as much median price affordability as possible. This trend reflects the current tight labour market but also suggests first home buyers may need to travel longer distances to their jobs. This was particularly prevalent in Brisbane.
• Choosing an affordable and liveable suburb in Brisbane is still the hardest, due to property price growth in Brisbane’s suburbs and a low level of ready-to-sell stock planned.
  

Percentage of Affordable Suburbs

Table 1 illustrates the percentage of affordable suburbs in each capital city, where an “affordable suburb” is defined as one with a lower median house/unit price than the closest metro area. For the first time, there is more hope for Sydney unit buyers, than those in Brisbane and Hobart. Hobart continues to be the most affordable capital city for house buyers.

Table 1. Percentage of Affordable Suburbs for Houses – 2nd Half 2025

Table 2. Percentage of Affordable Suburbs for Units – 2nd Half 2025

Affordable & Liveable Suburbs

Table 3 identifies suburbs that have met all PRD’s methodology criteria for being classified as an affordable and liveable suburb to buy in.

Hobart still has the most affordable suburbs for houses, followed by Melbourne. Brisbane is now the second most expensive city to buy houses, especially for people who are also looking for liveability factors and the possibility of new housing stock. The prospect of this price growth slowing down is unlikely, as suburbs with planned new stock are mostly those that have a median house price closer to or higher than the Brisbane Metro median house price. The trend suggests that to access new stock, Brisbanites must sacrifice affordability for availability.

Sydney remains the most expensive house market from the identified suburbs in this report, even though there is a high amount of new stock coming to the market. This has the potential of stimulating the Sydney market, due to demand for inner-city living (20km radius from CBD) becoming increasingly sought after.

For first home buyers looking to maximise their opportunity; Hobart units hold the lowest median price. Melbourne, not originally known as an affordable capital city, closely followed suit to Hobart’s unit market. However, due to Melbourne still being in a recovery phase and the ease of finding ready-to-sell housing stock projects for 2025, the city holds key buying opportunities for buyers.

Table 3. Smart Moves Suburbs for the 2nd Half of 2025

Methodology

Each Smart Moves report focuses on suburbs within a 20km radius of the CBD (or 10km for Hobart), taking into consideration the following criteria:

• Property trends – all suburbs have a minimum of 20 sales transactions for statistical reliability purposes. Based on market conditions, suburbs have either positive or as close as possible to neutral price growth between 2024 and 2025.
• Investment – as of September 2025, suburbs considered will have an on-par or higher rental yield than Sydney Metro and an on-par or lower vacancy rate.
• Affordability – identified suburbs have a median price1 below the closest capital city metro and below a set threshold. This threshold was set by adding a percentage premium to the respective state’s average home loan**. The percentage premium needed to achieve the affordable and liveable suburb’s median house or unit price must be lower than the percentage premium needed to achieve the Capital City Metro area’s median house/unit price. This ratio ensures higher affordability.
• Development – identified suburbs have new developments commencing construction in 2025***, with a high proportion of commercial and infrastructure projects. This ensures the suburbs show signs of sustainable economic growth. Suburbs must also show a reasonable amount of new ready-to-sell stock planned for construction to ensure buyers have access to some new supply.
• Liveability – all identified suburbs have low crime rates, availability of amenities within a 5km radius (i.e., schools, green spaces, public transport, shopping centres and health care facilities), and an unemployment rate on par or lower in comparison to the NSW average (as per the Department of Jobs and Small Business, June Quarter 2025 release).