Housing supply shortage is costing Queenslanders, says REIQ
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Photo by Kelly
The latest data from the Real Estate Institute of Queensland (REIQ) highlights the ongoing challenges faced by Queensland’s housing market, as insufficient housing supply continues to drive property prices upward across the state. According to the REIQ’s median sales data for the September 2025 quarter, both houses and units have seen significant price increases, with no signs of a slowdown.
Statewide, the median house price surged by 4.83% over the quarter, reaching $895,000 – a 12.67% increase compared to the same period last year. Units also showed robust performance, with the median price rising 3.57% to $725,000, marking an annual growth of 15.22%.
REIQ CEO Antonia Mercorella expressed concern over the rising costs for homebuyers in Queensland, attributing the trend to a classic supply-demand imbalance. “Across every corner of the state, prices are climbing in a concerning but classic supply story – when demand outstrips new housing delivery, prices inevitably move higher,” she said.
The data suggests that regional Queensland is experiencing some of the most dramatic price movements, though Greater Brisbane and its surrounding local government areas remain stable. “The particularly strong regional gains highlight that both investors and owner-occupiers are looking beyond the southeast corner for relative value and growth,” Mercorella added.
Investor activity in Queensland has seen a notable increase, as indicated by the Australian Bureau of Statistics (ABS) lending data. Investor loans in the state rose by 11.9% over the September quarter, with investors now comprising about two out of every five new home loans. Mercorella emphasised the importance of investor participation in maintaining a healthy rental market. “In a state like Queensland that relies heavily on investors to provide rental properties, it’s important to remember that investor participation is essential to achieve a healthy rental market,” she noted.
However, Mercorella warned that without improvements in overall housing supply, the competition between investors and potential owner-occupiers could intensify. “Unless we see overall housing supply levels improve alongside returning investor confidence, it can lead to the inevitable clash between investors and prospective owner-occupiers – and that is why the real solution must lie in expanding supply,” she stated.
The Federal Government’s expanded First Home Guarantee, which commenced on 1 October, is anticipated to help balance the scales in favour of owner-occupiers. Although first home buyer loans in Queensland dipped slightly during the quarter, the change was within expected volatility levels.
While some advocate for stricter investor lending rules, Mercorella advised caution, suggesting that excessive restrictions could exacerbate supply shortages in the rental market. “The focus should be squarely on unlocking more homes – not constricting one segment of the market. We need a balanced approach that supports both rental supply and pathways to ownership,” she said.
Mercorella further stressed the urgency for policy actions aimed at increasing housing supply. “Queensland’s housing market remains remarkably resilient and fiercely competitive, but price growth without sufficient new supply only deepens affordability challenges,” she remarked. “If we want a future where home ownership remains attainable, governments must stay firmly committed to driving new housing delivery and supporting first home buyers.”
Market insights across Queensland
The REIQ data highlights significant shifts in various regions. The Redlands has officially become a million-dollar-median house market, with prices reaching $1.03 million this quarter. Noosa saw its median house price surge to $1.5 million, joining Brisbane ($1.33 million), the Gold Coast ($1.26 million), and the Sunshine Coast ($1.16 million) in the million-dollar club.
Interestingly, both the most affordable and the most expensive major markets recorded some of the highest quarterly growth rates. Rockhampton experienced a 7.27% increase to $590,000, while Noosa saw a 7.14% rise to $1.5 million. Fraser Coast rounded out the top three for quarterly growth at 7.06%.
On an annual basis, regional Queensland exhibited exceptional growth, with Townsville leading at a 23.3% increase, followed by Mackay (22.33%), Gladstone (21.85%), and Rockhampton (21.11%). Other notable regional performers include Toowoomba (14.68%) and Bundaberg (12.91%).
Greater Brisbane also saw steady house price growth, with Ipswich leading at 13.6%, followed by Redland (11.93%), Logan (11.56%), and Moreton Bay (10.63%). Brisbane LGA itself increased by 6.77%, compared to the Greater Brisbane region’s 11.11% growth.
Units have become increasingly popular among first-time buyers due to their relative affordability compared to freestanding homes. Noosa recorded a dramatic 22.8% quarterly increase in its unit median to $1.15 million, while Rockhampton posted a sharp quarterly uplift of 19%. Bundaberg (9.89%), Townsville (8.86%), and Mackay (7.95%) also experienced significant quarterly gains.
On an annual scale, unit growth has been particularly steep, with Rockhampton leading the state at 30%, followed by Townsville (25%), Gladstone (24.39%), Ipswich (23.6%), and Fraser Coast (20.61%). Ipswich and Logan (19.56%) continue to be strong-performing non-regional unit markets.
Despite some markets moderating after previous strong runs, the demand for housing in Queensland shows no signs of abating, underscoring the urgent need for increased housing supply to address affordability challenges.