Australian Property Market – Prices, Trends, Forecast [October 2026]

Sydney

• Market performance: Across Sydney, housing values remain under pressure, with houses showing greater weakness than units and the broader correction still comparatively deep.
• Key Insights: Turnover has also softened, while selected outer areas have held up better than the citywide trend, underscoring uneven conditions across the market.

Read More: Latest Property Market Update for Sydney

Melbourne

• Market Performance: Melbourne’s decline has been milder recently than in several other capitals, but values remain below earlier peaks across a longer correction.
• Key Insights: Property types are diverging, with units showing firmer returns and yields than houses even as rental growth remains broadly similar.

Read More: Latest Property Market Update for Melbourne

Brisbane

• Market Performance: Brisbane has shifted from earlier strength into a sharper recent downswing, with both houses and units recording weaker short-term value movements.
  
• Key Insights: Sales activity has cooled noticeably, while rental conditions remain relatively tight, highlighting a widening gap between transaction momentum and rental demand.

Read More: Latest Property Market Update for Brisbane

Adelaide

• Market Performance: In Adelaide, dwelling values have eased from recent highs even though the market still retains stronger annual performance than several larger capitals.
  
• Key Insights: Rental conditions remain especially tight, while stronger local results appear across multiple areas, showing market variation is not confined to one part of the city.

Read More: Latest Property Market Update for Adelaide

Perth

• Market Performance: Perth is undergoing a recent correction after substantial longer-term gains, with both houses and units now showing weaker quarterly value movements.
• Key Insights: Transaction activity has slowed while rents continue to grow, separating softer buyer activity from conditions in the rental market.

Read More: Latest Property Market Update for Perth

Canberra

• Market Performance: Canberra continues to show subdued value performance, with both houses and units below earlier peaks and annual growth remaining weak.
• Key Insights: Local outcomes vary across the territory, while rental growth and yields differ by property type, reinforcing the need to separate price and income measures.

Read More: Latest Property Market Update for Canberra

Hobart

• Market performance: Hobart’s values have edged lower recently, though the market remains closer to its previous peak than some larger capitals.
• Key insights: Rental signals are mixed, with a comparatively high vacancy rate alongside positive rent growth, suggesting different measures are moving in different directions.

Read More: Latest Property Market Update for Hobart

Darwin

• Market performance: Unlike the other capitals, Darwin recorded continued value growth in the latest period, with units outperforming houses across shorter and longer horizons.
• Key insights: Rental growth and gross yields are elevated relative to other capitals, but the split between houses and units shows the market is far from uniform.

Read More: Latest Property Market Update for Darwin

Australian Property Market Trends

Australian dwelling values fell 1.1% in September, marking a sixth consecutive monthly decline and leaving national values 5.2% below their March 2026 peak. The downturn is broad-based, with declines across every capital except Darwin and 71% of regional SA3 markets, although regional markets continue to outperform the capitals.

Combined capital-city values fell 1.2% over the month, compared with a more moderate 0.7% decline across combined regional markets.

Buyer and Seller Conditions

Buyer demand has weakened as affordability pressures, higher interest rates, elevated living costs and weak sentiment constrain purchasing capacity. National home sales over the past three months were 19.1% lower than a year earlier, while total advertised inventory across the combined capitals was 23.1% higher despite new listings being 9.2% lower; homes are now taking a median 39 days to sell, up from 23 days a year ago.

Auction clearance rates have remained below average, consistent with softer demand. The increase in available stock is giving buyers more choice, less urgency and greater negotiating scope, while vendors are having to moderate price expectations and allow for longer selling periods.

Long-Term Home Value Performance

Here are the key takeaways from the latest value trends across capitals and regions, showing long-term growth, recent momentum, and where each market sits in the cycle

• National dwelling values are 5.2% below their March 2026 peak, while the five- and ten-year gains remain 19.9% and 62.4% respectively.
• Sydney is furthest below its peak at -8.6%, followed by Melbourne (-7.5%), Canberra (-6.2%) and Perth (-6.0%).
• Over five years, Perth is the strongest capital-city performer at 74.0%, while Melbourne is the weakest at -5.5%.
• Over ten years, Brisbane leads the capitals at 105.3%, while Melbourne has recorded the smallest increase at 24.3%.
• Regional markets have substantially outperformed the capitals over longer periods: combined regionals are 2.2% below peak, versus 6.4% for combined capitals, and have risen 34.5% over five years and 96.8% over ten years, compared with 15.6% and 53.3% for the capitals.
• Among regional markets, Regional WA has the strongest five-year result at 82.0% and Regional Victoria the weakest at 11.0%; over ten years, Regional Tasmania leads at 118.8%, while Regional Victoria is lowest at 78.1%. No market in the key-period table is currently at a record high, although Regional SA and Regional Tasmania are each only 0.1% below peak.

Rental Market Conditions

National rents rose 5.5% over the year, but the monthly pace slowed to a seasonally adjusted 0.3%, the smallest increase since May 2025. The national vacancy rate has risen from its February low, easing some pressure on rental growth, although at 2.0% it remains well below the pre-COVID decade average of 3.3%, indicating that rental supply is still relatively tight.

At the same time, rising rents and falling dwelling values are lifting gross rental yields; this offers some improvement in income returns for investors, although high holding costs remain a constraint, while renters continue to face stretched affordability despite the slower rate of rent increases.

• Annual national rental growth: 5.5%
• National vacancy rate: 2.0% — compared with a 3.3% pre-COVID decade average
• Gross rental yields: 3.9% national, 3.7% combined capitals, 4.3% combined regionals

Australian Property Clock Update

Each month, independent property valuation firm Herron Todd White (HTW) publishes a residential property report that assesses the performance of Australia’s 50 largest markets. HTW’s Property Clock grades each market based on current and predicted performance to determine whether it’s rising, falling, peaking or bottoming out.

Where House Markets Sit in the Cycle

Where Unit Markets Sit in the Cycle

• Rising phase: Darwin and Hobart are rising markets, alongside regional centres including Mackay, Rockhampton and Townsville.
• Peak positioning: Adelaide and Perth are approaching the peak, alongside Cairns and the Sunshine Coast, while regional markets including Albury, Bundaberg and Toowoomba sit at the peak.
• Decline classifications: Brisbane is starting to decline, alongside the Gold Coast and Geelong, while Sydney is the only market classified as declining.
• Recovery and bottom: Canberra and Melbourne are at the start of recovery, alongside Newcastle, while Port Macquarie is approaching the bottom and Ballina/Byron Bay and the Southern Highlands sit at the bottom.

Australian Property Market Forecast

Interest-rate pressure remains the clearest near-term drag on the national market. Together with weak sentiment, it is suppressing purchasing power and supporting downward pressure rather than a recovery. National sales over the past three months were 19.1% lower than a year earlier, confirming softer demand.

Persistently low new-housing supply should temper the decline, while a still-resilient labour market supports household income and reduces the risk of a sharper correction. These buffers cannot remove affordability pressures or restore demand, but they make a national downturn less consistent with the evidence.

The central path is a gradual drift lower, with substantial variation across regions, price points and buyer segments. Financing and affordability remain persistent restraints, while supply scarcity provides the principal counterweight.

The Australian banks forecast (Reviewed September 2026):

• ANZ expects capital-city prices to decline in both 2026 and 2027. ANZ forecast coverage
• CBA expects further national price declines before a modest recovery during 2027. CBA housing outlook
• NAB forecasts lower prices across the eight capital cities in 2026. NAB Housing Monitor
• Westpac’s June forecast anticipates flat prices in 2026 and growth in 2027, although its September update warns of further downside. June Housing Pulse, September housing update

For the remainder of 2026 and into 2027, this means:

• A softer near-term outlook: The bank updates point to continued pressure on property prices, replacing the earlier expectation of broadly rising values. NAB.
• Different conditions between cities: Sydney and Melbourne face the largest forecast declines in CBA’s outlook, although weakness has also spread to Brisbane, Perth and Adelaide. CBA.
• Borrowing costs remain important: The timing and strength of any recovery depend partly on interest rates. CBA’s forecast for modest growth in 2027 assumes rate cuts during that year. CBA.
• More negotiating room for buyers: Westpac reports rising listings and expects buyers to have greater bargaining power in many markets heading into spring. This is an interpretation of market conditions, not a guarantee for individual properties. Westpac.

Conclusion

Australia’s housing cycle is pulled in two directions: weaker purchasing power is reducing demand, while scarce new supply and labour-market resilience are containing the downside. Rental affordability remains strained even as vacancy rises. The broader market therefore points to gradual adjustment, with national softness coexisting with geographic divergence.