A question many aspiring homeowners and investors are currently asking is whether property prices have already peaked, and if now represents a suitable time to enter the market.

While short-term movements are difficult to predict with certainty, many buyers and investors focus instead on longer-term fundamentals. In the current environment, that approach is especially relevant, with shifting interest rates and recent Federal Budget changes both influencing the property landscape.

The 2026–27 Federal Budget introduced changes to negative gearing and Capital Gains Tax (CGT) concessions for existing residential investment properties from 1 July 2027. According to Treasury estimates, these reforms are intended to support housing affordability by increasing the availability of established homes for owner-occupiers. While existing properties are grandfathered, these changes may shape future investment decisions.

Against this backdrop, here are some key insights into current market conditions.

Price growth is easing
Recent data from Cotality shows a broad moderation in housing market growth across Australia. In April, all capital cities recorded slower price growth, with the national home value index rising by 0.3%, the slowest monthly increase since early 2025.

This softening reflects a combination of affordability pressures, tighter borrowing capacity, and broader economic factors such as inflation, interest rates, and consumer sentiment.

Market conditions vary significantly by location
While overall growth has slowed, performance across capital cities remains uneven.

Sydney and Melbourne both recorded monthly declines of around 0.6%, with values in Sydney now sitting slightly below their recent peak, and Melbourne showing a larger pullback from highs.

In contrast, several other markets continue to record growth. Perth led with a 2.1% monthly increase, while Brisbane, Adelaide, and Darwin also posted gains, albeit at a more moderate pace compared to earlier periods.

This highlights a fragmented market, where outcomes are highly dependent on location and local demand conditions.

Buyer demand has softened
Consumer confidence has recently fallen to very low levels, with the ANZ-Roy Morgan index reaching one of its weakest readings on record. This shift is being reflected in property activity, with sales volumes in capital cities tracking below both last year’s levels and the five-year average.

At the same time, listings have begun to rise in some markets, particularly Sydney and Melbourne, giving buyers more choice than they have had in recent months. However, mid-sized capitals continue to experience tighter stock levels, even as supply slowly increases.

Auction clearance rates have also eased compared to earlier in the year, suggesting a more cautious and selective buyer environment.

Lower price segments are outperforming
More affordable segments of the market have generally shown stronger growth than higher-priced properties. This trend is influenced by borrowing capacity constraints and increased participation from first-home buyers, supported by government assistance schemes.

In Sydney, for example, lower quartile house values have risen over the past year, while upper quartile values have declined, highlighting the divergence across price points.

Regional markets remain comparatively resilient
Regional areas have continued to outperform capital cities in recent months. Over the first part of 2026, regional markets recorded stronger combined growth than metropolitan areas, supported by affordability advantages and ongoing migration trends.

Outlook remains measured
Most forecasts continue to suggest modest growth through 2026, although expectations have been adjusted lower in recent months due to ongoing economic uncertainty, including inflation pressures and global market conditions.

Overall, the market has shifted from the stronger growth conditions seen in 2025 to a more balanced and selective environment.

So, is now a good time to buy?
The answer depends on individual circumstances, including financial position, borrowing capacity, and long-term objectives. While conditions may be more measured than in previous years, opportunities still exist for well-prepared buyers, particularly in aligned locations and price segments.

If you’re considering a purchase, we can help you understand your borrowing options and compare suitable home loan structures across lenders. As your mortgage broker, we’ll work with you to identify a solution that aligns with your goals. Get in touch to explore your options.