Sydney & Melbourne Forecast to Slow
New forecasts suggest Sydney and Melbourne property prices may soften in 2026 as economic pressures grow.
SQM Research now predicts Sydney prices could fall 2–6%, while Melbourne may drop 1–4% if interest rates rise and inflation remains elevated.
While some economists still expect modest growth, most agree the pace of price increases is likely to slow across the major capitals.
🔨 Auction Market Signals Caution
Auction clearance rates in Sydney and Melbourne recently sat around 67%, below the 70% level typically associated with strong price growth.
Buyers remain active but more cautious, with higher interest rates and cost-of-living pressures influencing borrowing decisions.
Demand remains strongest in family suburbs and more affordable markets, where owner-occupiers continue to compete for limited stock.
🏡 More Sellers Entering the Market
Property listings are also increasing.
Recent data shows new listings rose 16.7% in Melbourne and 8.4% in Sydney compared with the same time last year.
Some homeowners appear to be selling while prices remain near cycle highs. However, housing supply overall remains tight due to ongoing construction challenges, which could help limit price declines.
📊 Other Cities Still Performing Strongly
While Sydney and Melbourne may slow, Brisbane and Perth continue to outperform thanks to population growth and limited housing supply.
The key takeaway is that Australia’s property market is becoming increasingly segmented, with performance varying significantly between cities.
Understanding these shifts is critical for buyers and sellers, and insights from professionals like Rodney McLoughlin can help navigate the changing market with confidence.
Real Estate Newsletter
This article is a curated summary of various news stories from the past week, offering insights and updates on the real estate market. 13 March 2026.
Rodney McLoughlin is a trusted real estate professional with deep insights into the Australian property market. For personalized advice and market expertise, reach out to Rodney today.
