Many prospective buyers have been delaying their purchasing decisions as affordability pressures pushed home ownership further out of reach. RPM Buyer Surveys highlight this trend: between FY21 and FY25, the median age of owner occupier purchasers rose from 33 to 38, while median household income jumped nearly 50%, approaching $140,000.

This affordability strain coincided with an extended downturn in lot sales. From July 2022 to April 2025, monthly volumes remained below 1,000 lot sales.

Lot sales show a clear turnaround

The tide has now started to turn. Both May and June recorded more than 1,100 lot sales, marking a clear inflection point in demand. Much of this recovery can be attributed to the two rate cuts earlier in 2025, which improved borrowing capacity and lifted buyer sentiment.

Importantly, headline sales figures may understate the momentum underway. Secondary market activity has surged, with resale stock on market dropping by 50%.

Rate cuts unlocking pent up demand

The August rate cut was widely anticipated following Q2 inflation results, which showed annual growth easing to 2.1%, which is near the lower end of the RBA’s 2-3% target range. One or two additional cuts may follow by year’s end.

This series of shifts is expanding the pool of buyers and unlocking pent up demand.

Incentives supporting stock absorption

Incentives remain part of the equation. Rebates and discounts are expected to continue as developers work to accelerate the absorption of titled and near titled stock.

  • At the end of June, titled lots made up 41% of available supply
  • Another 30% are due to title before the end of 2025
  • Total developer stock currently sits at over 6,100 lots

Given this elevated supply, price growth is expected to remain subdued. Historically, upward pressure on lot prices only emerges once stock levels fall to around one-third of current volumes.

Building blocks for recovery

While conditions aren’t yet in place for a price surge, the building blocks for a sustained recovery in sales activity are firmly established. Improved affordability, rebounding buyer sentiment, and ongoing population growth are set to drive a gradual return to long term average sales volumes in the months ahead.

This article references findings from our Q2 2025 Victorian Greenfield Market Report.