Australian housing remains a key driver of household wealth, with Cotality estimating residential real estate at $12.6 trillion and more than half of household wealth held in housing.
According to Cotality’s April 2026 chart pack, in the latest quarter national dwelling values rose 2.1% and are 9.9% higher over the year, with combined regional markets outpacing the capitals.
Perth leads the pack, with annual gains of 24.3%, while Brisbane, Adelaide, and Darwin are also at record highs. By contrast, Sydney and Melbourne values slipped slightly over the quarter and remain just below previous peaks, signalling a more price‑sensitive market for borrowers in those cities.
Cotality Australia head of research Gerard Burg (pictured) links Perth and Brisbane’s outperformance to a structural supply shortage, noting that “overall, when we see a supply-demand imbalance such as those in Perth or Brisbane, we wind up with a large pool of buyers competing for a small pool of dwellings. This creates a seller’s market and can rapidly drive up home values, as we saw in these two capitals.”
Burg also highlights that “in WA and QLD, the share of dwelling completions fell well behind the share of population growth, with these states seeing home values more than double since 2020.”
Sales volumes over the past year are up 4.7% nationally, yet Cotality notes that first‑quarter transactions are tracking below both last year and the five‑year average.
New listings over the four weeks to 5 April totalled 36,712. According to the report, they were “3.3% lower than a year ago and 6.1% below the five‑year average.”
That combination of ongoing demand and constrained stock is keeping vendor discounting near record lows and supporting prices, even as growth momentum eases.
On the rental side, Cotality reports that “rental markets remain extremely tight, recording a vacancy rate of 1.6% in March, up from 1.5% in February but well below the decade average of 2.5%.”
Annual rent growth has re‑accelerated to 5.7%, pushing national gross rental yields to 3.57%, with Darwin above 6% and Sydney at just 3.1%. This environment continues to support investor interest and rent‑vesting strategies.
At the same time, mortgage rates are moving higher. The report notes that RBA has lifted the cash rate to 4.1% amid high inflation and a tight labour sector, with average variable rates on new owner‑occupier loans now in the mid‑5% range.
On top of that, APRA’s new macroprudential rules limit the share of new loans with debt‑to‑income ratios of six or more to about one‑fifth of new lending for both owner‑occupiers and investors, further constraining how far highly leveraged clients can stretch.
Despite higher mortgage rates, policy support is pulling more first‑home buyers into the market. Cotality highlights that “first-home buyer lending was up sharply in Q4, increasing 6.8% by volume and 15.5% by value, coinciding with the expansion of the 5% deposit guarantee.”
That surge coincides with a major policy shift: from 1 October 2025, the government removed caps on the number of guarantees and lifted property price thresholds under its 5% deposit scheme, allowing more eligible first‑home buyers to purchase with a 5% deposit and no lenders’ mortgage insurance.
First‑home buyers now account for 29.6% of owner‑occupier lending by value, just above the decade average. Investor activity is even stronger: investment lending jumped 31.8% over 2025 and now makes up 39.7% of all new lending by value, well above the long‑run share.
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