Australia property price forecast 2025-2026
The Aussie property market looks set for another year of growth, according to Domain's Price Forecast Report for the 2025-2026 financial year. Sydney and Melbourne are tipped to lead the charge, while price growth is expected to slow across Perth, Brisbane, and Adelaide.
"Lower interest rates, cheaper borrowing, and targeted support for first-home buyers will keep prices rising, especially in Sydney and Melbourne, which are most sensitive to rate changes," says Domain's Chief of Research and Economics Dr Nicola Powell. "The double-digit price growth we saw in Brisbane, Perth, and Adelaide are also forecast to soften."
That's not great news for aspiring first-home buyers. "The latest data is a reality check for many - if you're trying to break into the property market, the next year could be your toughest challenge yet," says Dr Powell. She adds that while rate cuts and government support could offer some relief, they may also continue to push prices up.
Let's break down the numbers.
Houses
House prices in most capital cities are on track to reach record highs by the end of June 2026, with Canberra being the only outlier. (Note: Hobart and Darwin weren't included in Domain's report.)
Sydney's median house price is projected to reach a record $1.83 million - a 7% jump (around $112,000) over the year, which is more than the average full-time income.
With a growth forecast of 6%, following two years of downturn, Melbourne's median price is tipped to be sitting at $1.1 million by the end of June 2026. Domain says Melbourne could be the best bet for first-home buyers, as prices there are now 63% lower than Sydney's - a big shift from 2019, when Sydney homes were only 26% more expensive.
Growth in Brisbane, Adelaide, and Canberra is expected to push all three further into the million-dollar club, says Domain, while Perth is likely to fall just short.
"Canberra remains the most affordable capital when you look at price-to-income ratios, thanks to slower population growth and a more balanced supply-demand dynamic," the report adds.
House price forecasts
|
Capital city |
Forecast growth |
Forecast price growth |
Forecast median price |
Price level |
|
Sydney |
7% |
$112,000 |
$1.83 million |
Record high |
|
Melbourne |
6% |
$66,000 |
$1.11 million |
Record high |
|
Brisbane |
5% |
$56,000 |
$1.09 million |
Record high |
|
Adelaide |
4% |
$36,000 |
$1.05 million |
Record high |
|
Perth |
5% |
$48,000 |
$982,000 |
Record high |
|
Canberra |
4% |
$39,000 |
$1.1 million |
7% below 2022 peak |
Source: Domain Price Forecast Report, 2025-26 financial year
Units
Median unit prices are expected to rise by 3% to 6%. This time, Sydney and Perth lead the pack, followed by Melbourne and Brisbane. Adelaide and Canberra are set to trail behind.
Unit prices in four of the six capital cities covered by Domain are on track to hit record highs by June 2026.
Even with a projected 5% increase, Melbourne's median unit price will still sit about 3% below its 2021 peak. Canberra is further behind, with a forecast median of $535,000 - still 15% below its 2023 high.
Sydney's unit prices are set to hit a record $889,000 - a 6% rise or about $53,000. Brisbane's median is expected to edge past $700,000 after a 5% lift.
Unit price forecasts
|
Capital city |
Forecast growth |
Forecast price growth |
Forecast median price |
Price level |
|
Sydney |
6% |
$53,000 |
$889,000 |
Record high |
|
Melbourne |
5% |
$29,000 |
$584,000 |
3% below 2021 peak |
|
Brisbane |
5% |
$31,000 |
$701,000 |
Record high |
|
Adelaide |
3% |
$18,000 |
$586,000 |
Record high |
|
Perth |
6% |
$33,000 |
$552,000 |
Record high |
|
Canberra |
3% |
$14,000 |
$535,000 |
15% below 2023 peak |
Source: Domain Price Forecast Report, 2025-26 financial year
Frequently Asked Questions about this Article…
Sydney's property market is expected to see significant growth, with median house prices projected to reach a record $1.83 million, a 7% increase. Unit prices are also set to hit a record high of $889,000, marking a 6% rise.
Melbourne's property market is forecasted to grow, with house prices expected to reach $1.1 million, a 6% increase. Unit prices are projected to rise by 5%, reaching $584,000, although this is still 3% below the 2021 peak.
Sydney and Melbourne are expected to lead in property price growth, with significant increases in both house and unit prices. Perth and Brisbane are also expected to see notable growth in unit prices.
Lower interest rates, cheaper borrowing, and targeted support for first-home buyers are key factors driving the increase in property prices, particularly in Sydney and Melbourne.
Entering the property market might be challenging for first-home buyers due to rising prices. However, rate cuts and government support could provide some relief, although they may also contribute to further price increases.
Brisbane and Adelaide are expected to see growth in property prices, with Brisbane's house prices projected to reach $1.09 million and Adelaide's $1.05 million. Both cities are expected to hit record highs by 2026.
Canberra's property market is expected to remain relatively affordable compared to other capitals, with house prices projected to reach $1.1 million, which is 7% below the 2022 peak. Unit prices are forecasted to be $535,000, 15% below the 2023 high.
Yes, Perth's unit prices are expected to reach a record high of $552,000, a 6% increase. However, house prices are projected to fall just short of the million-dollar mark, reaching $982,000.
Call 1300 880 160
Start a chat
Schedule a call
