Everything you need to know about the state of Australia’s property markets in 20 charts – August 2026

There is no doubt that our housing markets are facing challenges from all directions, but clearly they have remained more resilient than the property pessimists had predicted.

To better understand what's happening, this monthly collection of charts from Cotality paints an interesting picture.

According to Cotality, double-digit declines in home values would make little dent in the gains accumulated across mid-sized housing markets during Australia's five-year housing boom, according to their analysis modelling a range of downturn scenarios.

The latest data models what a 5%, 10%, 15% and 20% decline from peak dwelling values would mean across the major capitals.

The Chart of the Month below shows Melbourne has relatively little buffer after years of subdued growth, while the mid-sized capitals of Perth, Brisbane and Adelaide would retain much of the value gained during their recent housing booms.

Cotality Australia Head of Research Gerard Burg said with Sydney and Melbourne housing values already more than 5% below their respective peaks, and Brisbane and Adelaide entering a modest downturn over the past two months, the analysis provided useful context around how a deeper downturn could play out in different markets.

He further said:

"There's been plenty of discussion about how far housing values could fall, but the same percentage decline doesn't have the same impact everywhere.

Markets such as Perth, Brisbane and Adelaide recorded exceptional growth over the past five years, giving them a more significant buffer against declines than cities where values have been comparatively flat.

Melbourne had the least room to absorb further price falls after years of subdued growth, with dwelling values peaking at $840,000 in November 2025.

Melbourne's home values have recorded very little growth over the past five years, meaning a decline beyond 10% would return values to pre-pandemic levels.

Conversely, even if Perth's housing market fell 20% from its peak, the median dwelling value would still be around where it was in April 2025 after recording one of the strongest growth cycles of any capital city."

What would a downturn mean for your city?

Sydney - Already more than 5% below its peak, even a 20% downturn would only take Sydney's housing market back to around May 2021, highlighting the scale of the gains accumulated during the pandemic boom.

Melbourne - Melbourne has the smallest buffer of any major capital city, with a decline beyond 10% returning dwelling values to pre-pandemic levels after five years of subdued growth.

Brisbane - Despite entering a downturn only two months ago, Brisbane could absorb a 20% correction and values would still be around August 2024 levels after one of the country's strongest growth cycles.

Adelaide - Even a 20% decline would only return Adelaide's housing market to around April 2024, underlining the depth of its recent value growth.

Perth - Perth has the largest buffer of the major capitals, with a 20% downturn returning dwelling values only to around April 2025 after the nation's strongest recent growth cycle.

What’s driving the downturn

Mr Burg said affordability pressures and mortgage serviceability constraints first emerged in higher-value markets before higher interest rates, cost-of-living pressures, weaker consumer confidence and reduced investor activity following the Federal Budget weighed more broadly on buyer demand.

He said the analysis was intended to illustrate the implications of a range of downturn scenarios rather than predict where home values would ultimately land.

"Although housing values are falling across more cities, underlying supply and demand conditions remain quite different,” he said.

“Markets that experienced the strongest growth over recent years are entering this downturn from a much stronger position. Understanding where values would return to under different scenarios provides useful context for buyers, sellers and policymakers, particularly given how differently each capital city has performed over recent years."

• The total value of Australian residential real estate was $12.4 trillion at the end of July 2026.
• Outstanding mortgages against all residential housing are only $2.6 trillion - a very comfortable 20% Loan to Value ratio.
• 56.8% of total Aussie household wealth is held in residential property - one of the many reasons neither the banks, the government nor the RBA wants a property crash.

Australian dwelling values

• The rolling quarterly trend for national dwelling values was down 1.9% over the three months to July.
• The annual growth trend continued to ease, with the national median dwelling value up 5.3% over the year to July, adding approximately $49,200 to the median Australian dwelling value.
• Nationally, dwelling values in the lower quartile of the market have shown a substantially stronger growth trend.
• However, as a property investor, you can always outperform the average.

Our capital city markets are fragmented

Our housing markets are fragmented, with each state performing differently depending on local economic and market factors.

The following chart shows how different price segments in each capital city market are performing.

Each State is running its own race

Brisbane property values are now -0.7% below the record high seen in May 2026.

• Perth property values are also down -0.4% from the record high seen in May 2026.

• Sydney property values are now -5.3% below the record high seen in January 2026.

• Melbourne property values decreased -1.2% for July, also decreased -2.8% over the year, and are now -5.5% below the record high seen in March 2022.

• Hobart house prices are -0.7 % below their record highs recorded in March 2022.

Here's how the Adelaide property market performed.

•  Dwelling values in Canberra increased 1% over the last year, but are currently down - 4.2% below their record high seen in May 2022.

• The Darwin housing market has performed strongly, increasing 16.3% over the year and is currently at a new record high.

Here's how many properties are for sale at the moment

• New listing activity has eased since reaching a peak in early March, with the usual winter slowdown alongside cyclical factors reducing the number of properties coming onto the market.
• While the flow of new listings has remained above last year's levels for most of the year, freshly listed properties were tracking 7.1% below the five-year average over the four weeks ending August 9th.
• The problem is that very few are A Grade homes or investment grade properties. Owners of quality properties are holding onto them.
• After commencing 2026 well below year-ago levels, total listings rose steadily during the first half of the year and surpassed 2025 levels by mid-year.
• After tracking 3.7% below the five year average in early July, total listings are now 0.1% above average nationally.
• Total listings are up 14.9% relative to a year ago, with the gradual rise attributable to easing buyer demand rather than a flurry of new listings activity.

Transaction volumes

• National home sales fell by 0.8% over the year to July 2026, with the divergence between regional and capital-city markets continuing to widen.
• Monthly sales remain below the five-year average, after trending lower from a peak in October last year. The market remains split.
• Across the combined regional areas, sales volumes rose by 4.2% year on year, while volumes across the combined capitals fell by 3.5%.
• Most of the weakness was concentrated in Perth (-14.8%), Brisbane (-7.2%) and Sydney (-4.2%), while growth was largely driven by regional Victoria, regional New South Wales and the Northern Territory.

Homes are taking slightly longer to sell

• Nationally, the median time on market rose to 35 days, up from 32 days in the previous month, as homes continued to take slightly longer to sell.
• Selling conditions have softened across both capital-city and regional markets since late 2025, although the increase has been more pronounced across the capitals.
• The median selling time increased to 33 days across the capitals, from 26 days, and to 39 days across regional areas, from 36 days.
• Regional Northern Territory remains the clear outlier, with homes taking a median of 83 days to sell.

Vendor Discounting

• Vendor discounting has continued to increase as the number of properties listed for sale has risen, giving buyers greater negotiating power.
• Across the combined capitals, the median vendor discount widened to 3.9%, up from 3.2% in the three months ending April, while discounting rate in regional areas increased slightly, though the change was modest, rising from 3.3% to 3.7%.

Auction clearance rates

• Auction clearance rates across the combined capital cities have declined since February, falling from approximately 66% to reach a low point of just 42.3% in late June.
• Although clearance rates have lifted from the June low, they have remained below 50% since the last week of May.
• Auction outcomes and trends in home values have shown a strong correlation historically, implying further downside pressure on home values.
• We update the weekly auction clearance results here each week.

We're still experiencing a rental market crisis in Australia.

• The rental market remains tight, with annual growth steady at 5.9% over the year to July 2026, unchanged from last
  month.
• This is up from a mid-2025 low of 3.4%, with the rise evident across both capital cities and regional markets.
• The combined capitals and combined regionals are both at 5.9%, so rental growth is broadly even across the board.
• At 5.9%, rent increases still outpace wage growth (3.3%), meaning most renters are spending a larger proportion of their income on rent than a year ago.

• National gross rental yields (3.72%) reached their highest level since April 2023, supported by rising rents and easing home values.
• This is up from the 2022 low of 3.2%. Yields remain higher across regional areas, at 4.2%, compared with 3.6% across the capitals.
• The highest yields were recorded in Regional Northern Territory at 7.6% and Darwin at 6.2%, while Sydney had the lowest yields at 3.3%, followed by Brisbane (3.4%) and Adelaide (3.5%).

Dwelling approvals and housing credit

• Unit approvals rose to 7,460 in June 2026, although activity remains well below the February peak of 9,514.
• Persistently high construction costs continue to weigh on apartment development, making projects more difficult to finance and bring to market.
• Meanwhile, house approvals have risen to 10,868, a 16.0% annual increase with approvals 10.7% above the decade average.
• Demand for smaller homes, faster build cycles and greater participation from owner-builders has provided support to the detached housing sector.
• Dwelling commencements also moved higher over the quarter, increasing by 3.6%, with apartment commencements leading the gains through a 9.8% rise.

Finance and Lending

• From a peak in December 2025, the value of home lending fell 3.8% in the March quarter.
• The decline was broad based across borrower types but led by owner-occupiers (down 4.3%) ahead of investors (down 3.0%).
• This saw the investor share of lending rise to its highest rate since September 2016.

• First-home buyer lending as a proportion of owner-occupier lending reached 29.2%, slightly exceeding the decade
  average of 27.6%.
• This increase highlights a rise in first-home buyer activity following the expansion of the 5% deposit guarantee.
• ACT remains the strongest market for first-home buyers at 37.0%, followed by the NT (36.6%) and TAS (33.4%).
• Conversely, QLD (27.3%) and NSW (27.0%) represent the smallest shares, with QLD marginally below its ten-year average of 27.5%.

Source of charts: Cotality Monthly Housing Chart Pack, August 2026

• Also read:This week’s Australian Property Market Update – Latest Data, State by State August 18th 2026
• Also read:Melbourne property market forecast for 2026 & 2027 | Separating the fundamentals from the sentiment
• Also read:Brisbane Property Market Forecast [2026 & Beyond] – What The Olympics Decade Means for Investors.
• Also read:Sydney property market forecast for 2026 and 2027 | Why the short-term softness is a long-term opportunity
• Also read:Latest Property Price Forecasts. Australian Property Market Outlook 2026-2027: Navigating a Market Correction