We tested population, interest rates, jobs, housing supply and price momentum against 20 years of ABS and RBA data for every state and territory. Here’s what actually drives prices, and what doesn’t.
Click states to add or remove them. Hover for values.
Each dot is a state, for the year to June. Drag the slider to change year.
Relative strength of each factor (standardised effect). Hover for what it means.
Rate rises tend to slow price growth within about a year, typically by 1 to 2 points for each 1-point rise. Since 2023 prices kept rising despite higher rates.
Sources: ABS Total Value of Dwellings (mean price of residential dwellings), National, State and Territory Population; RBA tables F1.1 and F5 (discounted variable owner-occupier rate). Used under CC BY 4.0. Driver strengths from Factor Capital’s regression analysis of 2004–2026 data. General information only, not advice.
| Factor | What the data shows | Strength |
|---|---|---|
| Population growth | Faster-growing states consistently see faster price growth. Held up in both 2004–2021 and 2011–2026. | Strong |
| Price momentum | Rising markets tend to keep rising for a while, and falling ones keep falling. | Strong |
| Catch-up | States priced well above the national average grow more slowly; cheaper states catch up over time. | Strong |
| Interest rates | Higher mortgage rates slow price growth, usually within a year. The effect weakened in 2023–2026, when prices rose despite rate rises. | Moderate |
| Unemployment | No consistent effect once population and momentum are taken into account. | Weak |
| New housing approvals | No measurable effect at state level. Supply likely matters more suburb by suburb than across a whole state. | Not detected |
We regressed annual dwelling price growth in all eight states and territories on population growth, unemployment, housing approvals, past price growth, each state’s price relative to the national average, and changes in mortgage rates. We used two data sets: the ABS Residential Property Price Index for 2004 to 2021, and the ABS mean dwelling price for 2011 to 2026. State-level effects were measured by comparing states with each other in the same quarter, so national events like COVID don’t distort them. Interest-rate effects were measured from the national series over time.
The limits: twenty years covers only a few rate cycles, and models like this explain differences between states far better than they predict where national prices go next. We don’t publish price forecasts for that reason.
Our Commercial Property Rate & Yield Calculator applies the same rate drivers to commercial property, using bond-style pricing and the live yield curve. Factor Capital arranges business and commercial finance only and doesn’t arrange home loans.
Sources: Australian Bureau of Statistics (Residential Property Price Indexes; Total Value of Dwellings; National, State and Territory Population; Labour Force; Building Approvals) and Reserve Bank of Australia (tables F5 and F1.1), used under CC BY 4.0. Analysis by Factor Capital. This page is general information only. It isn’t financial, property or credit advice and doesn’t take your circumstances into account. Past relationships may not hold in future.
See also: RBA cash rate and bond yields.
