Price Trend Line = Houses v Units 

The graphs above represent a trend line of the median price performance at capital city level. Source = Cotality.  Note the above graphs don’t represent ‘prices’ but show ‘price changes’ over time.

Houses – Based on price change results alone, Darwin recorded the strongest monthly growth in median house values during the past month, rising 0.7%, followed by Hobart (0.2%) however volumes are small for both areas which can distort the data.  Perth price growth is slowing though still achieved an increase (0.1%). Sydney continued to decline (-1.7%), along with Melbourne (-1.4%) and Canberra (-1.2%), while Brisbane (-0.6%) and Adelaide (-0.2%) recorded more modest falls. The results continue to highlight the divergent conditions across Australia's capital city housing markets, with weaker conditions persisting in the larger east coast markets while Perth, Hobart and Darwin continued to show relative resilience.

Units – Darwin recorded the strongest monthly growth in median unit values over the past month, rising 1.0%, followed by Perth (0.3%), while Adelaide remained unchanged (0.0%). Sydney experienced the largest monthly decline (-0.8%), ahead of Melbourne (-0.7%), Canberra (-0.5%), Brisbane (-0.4%) and Hobart (-0.2%). Overall, unit market conditions remained mixed across the capital cities, with two capitals recording growth, one remaining stable and five recording a decline.

FORECAST 

This is the first full month recording market activity in the post-Budget environment, and it clearly shows the impact of the Federal Government’s changes.  While the market was beginning to slow in reaction to global events and last three interest rate rises, changes to property legislation has pushed the headline level price performance numbers into negative territory.

Where is the market heading?

Currently the media is full of ‘commentators’ either amping up the downturn or playing down the market impact.  The truth is we’re still dealing with a triple speed market, where most areas with price points of $2M or more are softening unless they’re in very coveted locations, for example Manly in NSW.

There’s a middle market slightly overlapping the top end, priced at $1.5M to $2.5M, where prices are holding up well for very attractive properties, creating opportunities for renovators to acquire properties that will be the first to bounce back when the market regains momentum.

The sub $1.5M market is currently still rocketing along in most areas across Australia.  This market is supported by first time buyers and ‘right-sizers’, and also received a little extra boost from last minute SMSF buyers trying to meet the borrowing limit deadline of 10 August 2026.

Even with the SMSF buyers out of the picture after 10 August, it’s hard to see the sub $1M market slowing too much as the buyer pool has such a broad base.

Across all three levels of the market, we can expect a bump in properties available for purchase in Spring which should mean the buyers’ market will continue for the next few months before tightening up again early in 2027.

Rents - Houses v Units

Once again, please note the graphs below show ‘price changes’ not actual pricing [ eg – even though Darwin looks to be ‘on top’ this means it’s increasing faster than other locations, not that it’s more expensive.]  Overall rents look to be stabilising, with very minimal change over the past couple of months.  

Vacancy Rate

This data is drawn from SQM Research.  It represents the total vacancy rate in each major city.  A ‘healthy’ rate is around 2.5%. Anything below this means the amount of properties available for rent is not sufficient to meet the amount of people who want to rent in that particular area.  As you can see, all areas of Australia need more rental properties (all areas are under 2%), although supply is getting closer to healthier levels in Melbourne and Canberra. 

Employment 

Employment levels are an important indicator of economic health, and something the RBA monitors closely when deciding what to do with interest rates.  This information should also be monitored by property buyers as a leading indicator of locations to avoid or consider for their next purchase. 

The sweet spot for a good level of unemployment – where there’s enough jobs for those who want them - will hover between 4 and 5% depending on the rate of jobs turning over.

Anything below 4% would be considered to be low unemployment and would suggest a strong jobs market, attracting workers which increases demand for housing and pushes capital growth and rental returns upwards.

Anything in the 4.5% and upwards would reflect high unemployment which will indicate economic struggles, leading to weaker property price growth and eventually declines.

Population Growth 

This graph shows the change in population by State over the last reporting period.  The data includes changes caused by both overseas migration and also where Australians are moving from one state to the other.  Overall Australia had 306,000 migrant arrivals in 2024 -2025, a slight decrease over the previous 2023-2024 year of 400,000.

Building Approvals

The graphs below show the monthly dwellings approved in each State and Australia-wide, and also the percentage change.  In 2024, the Australian Federal Government announced a target of delivering 1,200,000 homes by 2029 and to achieve this we need to build 240,000 dwellings (houses and units) per year.  As you can see, we’re falling drastically behind on this target.

RBA Cash Rate (Interest Rate)

4.35%

Australian Dollar

1 AUD = 0.70 USD

Dwelling Values Trend Line

The graph above shows the price trend line for houses and units combined.  While this information is useful, it’s important to remember to look at pricing at suburb level and review pricing for your specific property type in order to identify opportunities and know what price to offer for your next purchase.

Looking at the combined (houses + units) dwellings data, Darwin recorded the strongest monthly growth in median dwelling values during the past month, rising 0.8%, while Perth and Hobart each recorded a modest increase of 0.1%. Adelaide remained relatively stable, declining just 0.2%, while Brisbane recorded a fall of 0.6%. Sydney experienced the largest monthly decline (-1.4%), followed by Melbourne (-1.2%) and Canberra (-1.0%). Overall, the combined dwelling results highlight mixed conditions across the capital cities, with three capitals recording growth and five recording a decline.

Of course, in order to be successful, where you buy depends on your personal requirements as well as what’s happening in the market so book in for a Property Clarity Chat if you would like more tailored, personal recommendations.

If you’re looking for a more detailed review of the market, check out the information below.