Victoria’s greenfield market rebounds: Inside the key metrics shaping Q3 2025

Victoria’s greenfield property market is showing clear signs of a meaningful rebound, with Q3 2025 delivering the strongest quarterly performance in more than three years. After a prolonged period marked by rate uncertainty, construction cost escalations, and subdued buyer confidence, momentum is now re-emerging across land, medium-density housing, and development site activity. RPM’s Q3 2025 Victorian Greenfield Market Report highlights a sector responding positively to improved affordability, government incentives, and shifting buyer behaviour, particularly among first home buyers and upgraders. This article unpacks the key metrics shaping the market, the drivers behind renewed demand, and why the fundamentals suggest continued strengthening into 2026.

A Market Turning the Corner

After two cautious years, greenfield conditions across Melbourne and Geelong are stabilising, and confidence is returning. Population growth, easing affordability pressures, and an increasing alignment between buyer needs and developer offerings have combined to create forward momentum in the sector. Families, in particular, are driving much of this renewed demand, placing greater value on proximity to schools, transport and community infrastructure. Medium-density housing, especially townhomes, is also accelerating. With many households earning around $100,000 still struggling to enter the detached housing market, turnkey townhomes have become a crucial entry point. Investors, too, have begun re-entering the market, adding competitive pressure at a time when supply remains constrained.

Macro Conditions: Rates Hold Steady, Confidence Rebuilds

Economic indicators help frame the market’s trajectory. Inflation ticked up in Q3, with annual CPI reaching 3.2 per cent, pushing expectations of further rate cuts into 2026. The cash rate remained steady at 3.60 per cent for the third consecutive month, and unemployment rose modestly to 4.5 per cent nationwide and 4.7 per cent in Victoria. Despite these pressures, wage growth, steady GDP gains and improved borrowing capacity (thanks to earlier 2025 rate cuts) supported purchaser sentiment. Buyer surveys indicate that households are adjusting to a “higher for longer” rate environment rather than waiting indefinitely for lower borrowing costs.

Development Site Activity: Education Leads the Way

One of the most compelling indicators of long-term growth is activity from education providers. RPM’s Transactions & Advisory team reported more than $50 million in school site transactions since June 2025, reinforcing how critical education infrastructure has become to Melbourne’s major greenfield corridors. Significant transactions included:

• 10-hectare private school site in Wollert, sold to Hume Anglican Grammar, positioned near future transport corridors and a major town centre.
• 2.6-hectare private school site in Donnybrook, opening the door for new entrants in one of Victoria’s fastest-growing regions.
• 4.5-hectare site in Fraser Rise, secured by St Mary Coptic Orthodox College, strategically located near the future Plumpton Major Town Centre.

These acquisitions demonstrate the escalating importance of educational amenity in shaping buyer demand and corridor identity. Providers are planning for catchments of more than 350,000 residents by 2041 in areas such as Wollert, an early signal of future population growth.

Medium Density: Townhomes Drive Affordability and Uptake

The medium-density segment is experiencing unmistakable momentum. Unit prices rose 2.1 per cent in Q3 to $645,500, marking their highest level in nearly three years. With established home prices climbing at a similar pace, new greenfield townhomes remain one of the most accessible market entry points. A typical turnkey townhome priced around $575,000 remains affordable for households earning just above $100,000. Should rates ease again in 2026, borrowing capacity could rise further, pushing townhome prices up as demand strengthens. Buyers waiting for lower rates risk paying more later, a fact increasingly reflected in their purchasing behaviour. Key market factors:

• 61 per cent of townhome buyers in 2025 were owner-occupiers.
• 65 per cent were first home buyers, many taking advantage of stamp duty concessions and the 5 per cent deposit scheme.
• Projects such as Eliston Place (Clyde) and Olio (Officer) saw strong sell-through rates, with stages nearly sold out heading into Q4.

The return of investors has added pressure to an already tightening supply pipeline, signalling that townhome demand may outpace available stock through 2026.

Vacant Land Market: Strongest Sales in Three Years

The vacant land sector recorded 3,649 gross lot sales in Q3 2025, up 16 per cent from Q2 and 54 per cent annually, marking the most active quarter since 2022. Improved affordability, multiple RBA rate cuts earlier in the year, and developer incentives all contributed. Key Metrics:

• Median Melbourne lot price: $399,000 (+1.5 per cent QoQ)
• Median lot size: 355sqm (+1.1 per cent QoQ)
• Average trading days: 177 (improved from 185)
• New supply: 13 new estates launched, the highest since Q4 2021
• Total available stock: 5,685 lots (down 5.5 per cent)

First home buyers remained the largest purchaser group at 47 per cent, followed closely by upgraders at 42 per cent, highlighting renewed activity among family households seeking larger homes (with demand for >30sq homes now nearly matching 21–25sq options).

Growth Corridor Performance

Western Corridor

• 1,208 lot sales (+17 per cent QoQ), retaining the title of Melbourne’s most active corridor.
• Median lot price: $386,000 (+0.5 per cent)
• Median lot size: 360sqm (+1.7 per cent)

Titled lots made up 49 per cent of sales , the highest proportion across metro Melbourne. Northern Corridor

• 1,106 lot sales (+9 per cent)
• Median price: $386,650 (+3.4 per cent)
• Lot size held steady at 350sqm

Stock returns fell sharply by 43 per cent, reflecting stronger buyer commitment. South East Corridor

• Strongest growth, with 957 sales (+22 per cent)
• Median price: $437,500 (−0.3 per cent)
• Lot sizes increased to 364sqm

Stock dipped below 1,000 lots, the lowest since mid-2024. Greater Geelong

• 378 sales (+16 per cent)
• Significant titled lot share (61 per cent) keeping trading days high at 338.
• Median price: $376,900 (−1 per cent)

Lot sizes trended smaller at 390sqm.

Regional Victoria: Strong Recovery Continues

Regional markets defied seasonal downturns, recording the strongest performance of 2025. Ballarat

• 107 sales (+35 per cent)
• Median price: $285,000 (steady)
• Lot size fell to 448sqm (−3 per cent).

Bendigo

• 166 sales , highest since 2020, up 168 per cent
• Median price: $262,000 (−1 per cent)
• Lot size: 512sqm (−1 per cent).

Drouin & Warragul

• 103 sales (+39 per cent)
• Median price: $316,000 (−8 per cent)
• Lot size: 504sqm (−5 per cent).

Macedon & Mitchell

• 63 sales (+75 per cent)
• Median price: $390,000 (−6 per cent)
• Lot size: 680sqm (+5 per cent).

Affordability and lifestyle appeal continued to underpin demand across all regional markets, supported by lower borrowing costs earlier in the year.

Buyer Behaviour: What’s Influencing Decisions?

RPM’s survey of 277 buyers in Q3 revealed evolving motivations: Buyer Profiles

• 71 per cent owner-occupiers
• 47 per cent first home buyers
• Indian-born buyers represented 46 per cent, followed by Australians at 30 per cent.

Buying Intent

• 52 per cent of buyers planned to begin building immediately after settlement.
• 54 per cent purchased after one visit to an estate.

Budgets The bulk of home & land budgets sat between $600,000–$750,000, reflecting affordability preferences amid elevated construction costs.

Outlook for the Remainder of 2025 and Into 2026

The report highlights several forces shaping the market’s next phase:

• Rate cuts are likely delayed into 2026 due to elevated Q3 inflation.
• Developer incentives, though smaller, will continue to support buyer activity.
• A large proportion of current stock (57 per cent) is titled or nearing title, positioning Q4 campaigns to focus on clearing excess supply.
• The expanded Home Guarantee Scheme is expected to fuel demand, particularly among established home vendors seeking to upgrade.

Underlying demand remains solid, driven by population growth, strong first home buyer participation, and increasing interest in townhomes and smaller lot products. As affordability stabilises and supply gradually tightens, RPM expects lot sales to continue trending upward through 2025 and into 2026. Q3 2025 marks a pivotal turning point for Victoria’s greenfield market. Improved affordability, resilient buyer sentiment, strong education-driven development activity, and surging regional performance highlight a market moving into recovery mode. While economic headwinds remain, including delayed rate cuts and persistent cost pressures, the fundamentals are strengthening. With supply tightening in key corridors, incentives still available, and demand building across both land and medium-density sectors, Victoria’s greenfield market is poised for continued growth heading into 2026.