Brisbane home prices continued to outperform most capital cities this year, though Perth is expected to take over as top performer as the Australian housing market corrects, driven by rising interest rates to limit inflation, the latest QBE Housing Outlook says.

Perth and Darwin were the only capital cities forecast to have higher house prices three years from now. Median values in Sydney, Melbourne, Brisbane, Canberra, Adelaide and Hobart were all predicted to be lower by June 2025.

Unit prices were expected to fare better, growing 6% in Darwin, 5% in Perth, 4% in Canberra, 1% in Adelaide and 0.4% in Brisbane by 2025. Falls of 2% in Hobart, 0.4% in Melbourne and 0.1% in Sydney over three years were forecast.

Last year, Brisbane’s housing market was the strongest performer, with the median house price increasing 32% over the year – compared to 22% nationally.

“Brisbane continued to outperform most cities through 2022, despite enduring major flooding earlier in the year,” the report said. Relative affordability compared to Sydney and Melbourne was a driver, though the report says "this gap is waning”.

The “green edition” of the long-running report says Australia has the highest uptake of solar panels in the world, with nearly 3.2 million installations, or around 30% of all homes.

LED lighting and better insulation are among the most highly installed energy saving initiatives, while adoption of lighter coloured roofs, double glazed windows, and solar or heat pump hot water systems – which use 60-70% less energy than a conventional electric system – still remains relatively low overall, but is rising, the report says.

On the house price outlook, the report says Sydney’s median house price is expected to fall 14% next year. Falls of 11% in Melbourne and Brisbane in 2023 were forecast, as were falls of 4% in Perth, 3% in Darwin and 8% in Canberra, Adelaide and Hobart.

Here are the report’s mid 2025 median capital city house price forecasts:

Sydney $1.405 million (currently $1.53 million)

Melbourne $995,000 ($1.06 million)

Brisbane $819,000 ($864,300)

Perth $679,000 ($664,800)

Adelaide $676,000 ($717,600)

Hobart $776,000 ($811,000)

Canberra $996,000 ($1.02 million)

Darwin $647,000 ($627,200)

See the 2022-25 Housing Outlook Green Edition here.