Amid a shifting economic backdrop, the fundamentals of the Australian property market are quietly aligning in favour of investors. With interest rate cuts stimulating renewed demand, profitability holding firm, and housing values steadily recovering, many are asking—could this be the window of opportunity for strategic property investment?
According to Cotality’s Pain and Gain Report (June 2025), 94.9% of national resales in the March quarter delivered a nominal profit, with a median gain of $305,000. While this figure dipped slightly from the previous quarter, it reflects a brief adjustment rather than a reversal—profitability is already trending upward as national home values lifted 1.3% over the three months to May 2025.
Locally, Melbourne’s market is showing signs of renewed confidence. The CoreLogic June Chart Pack notes that Melbourne dwelling values rose 0.3% over the past quarter, continuing a modest but consistent recovery. Importantly for investors, Melbourne’s rental market remains tight. Despite median dwelling values being relatively soft, annual rent growth has reached 9.5%, helping to lift gross rental yields to 3.38%—a noticeable shift from the 3.04% recorded this time last year.
Units, often viewed as a more affordable entry point, are regaining momentum. Nationally, profit-making unit resales rose to 90.1%. In Melbourne, while some older inner-urban stock continues to underperform, this is creating well-timed buying opportunities in locations with long-term upside. As Cotality notes, many recent loss-making unit sales were concentrated in oversupplied pockets that had already underdelivered for a decade.
This kind of seller activity, combined with overall listing volumes that remain well below the five-year average, may present a rare advantage for buyers. Investors willing to act decisively—particularly in quality, well-located stock—can position themselves ahead of broader market recovery and renewed competition.
Investor sentiment tends to follow the market, but smart investment often precedes it. With cash rate cuts in motion and capital growth gradually rebounding, the current environment offers an advantage to buyers who act decisively while competition remains moderate.
As always, the key is strategic selection—choosing the right location, asset type and timing. For those looking to build or rebalance their portfolio, this could be a smart time to take a fresh look at the market.
In compiling this article, Kay & Burton relied upon information supplied by several external sources. This article has been provided for general information only and has not been tailored to your personal circumstance. Although high standards have been used in the preparation of the information, analysis, views, and projections presented in this article, Kay & Burton does not owe a duty of care to any person in respect of the contents of this article and does not accept any responsibility or liability whatsoever for any loss or damage resulting from any use of, reliance on or reference to the contents of this article.