Two Speed Market: Perth Surges While Sydney Stalls in April 2026

If you only read the national headlines, Australia's property market looks healthy. National dwelling values rose 0.6 per cent in March, bringing the national median to $922,838. Year-on-year growth sits at 9.9 per cent. The combined capitals median has crossed the million dollar mark at $1,014,401.

But those national figures mask what is really happening: a dramatic split between markets that makes generalising almost meaningless.

The Boom Cities: Perth, Brisbane, Adelaide

Perth is the standout performer, with dwelling values rising between 1.9 and 2.3 per cent in March alone — a quarterly gain of 6.1 per cent. Values in Perth have more than doubled since 2020, driven by a perfect storm of low supply (listings are 47 per cent below the five-year average), strong mining sector wages, and interstate migration.

Brisbane is not far behind, posting 1.6 per cent monthly growth and a 5.2 per cent quarterly gain. Queensland continues to benefit from the interstate migration trend that accelerated during the pandemic and shows no signs of reversing. With the 2032 Olympics on the horizon, infrastructure investment is adding further fuel.

Adelaide rounds out the growth trio with 1.3 per cent monthly growth and a 4.2 per cent quarterly gain. Low stock levels remain the key driver — there simply are not enough properties available to meet demand.

The Stalling Markets: Sydney and Melbourne

Sydney's market has effectively flatlined, recording just 0.0 to 0.3 per cent growth in March with a slight quarterly decline of 0.1 per cent. Listings are 8 to 12 per cent above the five-year average, giving buyers more choice and less urgency. Affordability constraints are biting hard — the typical Sydney household now needs 40.4 per cent of after-tax income to service a new mortgage at 80 per cent LVR, the worst reading in the country.

Melbourne is in similar territory, recording flat monthly growth and a 0.4 per cent quarterly decline. Elevated stock levels and some of the highest stamp duty rates in Australia are weighing on buyer activity. For Melbourne, the silver lining is relative affordability — at 23.9 per cent of income needed to service a new loan, it is actually the most affordable major capital city.

Auction Clearance Rates Tell the Story

Easter week delivered the lowest preliminary auction clearance rate in almost four years:

• National: 55.5 per cent (lowest since July 2022)
• Sydney: 53.4 per cent (lowest since July 2022)
• Melbourne: 58.3 per cent
• Brisbane: 55.7 per cent
• Adelaide: 57.7 per cent

Auction volumes were 7.8 per cent higher than Easter 2025, but success rates were significantly lower. This is a leading indicator that the two RBA rate hikes in 2026 are having a real impact on buyer confidence and capacity, even in the markets where prices are still rising.

Affordability Is Getting Worse

The national housing affordability reading now sits at 29.6 per cent — meaning the average household needs to spend nearly 30 cents of every after-tax dollar to service a new mortgage. Moody's has warned that affordability will deteriorate further through 2026 if rates continue to rise.

The two 2026 rate hikes have reduced maximum borrowing capacity by approximately $25,000 for a single average-income borrower and $49,000 for a dual-income couple. If the cash rate reaches 4.35 per cent in May (as all four major banks expect), the national affordability measure would push toward 33 per cent.

Perhaps the most telling statistic: the lower quartile of the market (the cheapest 25 per cent of properties) rose 3.1 per cent in Q1, compared to just 0.7 per cent for the upper quartile. First home buyers and investors targeting affordable stock are driving demand at the bottom of the market, while premium properties stagnate.

Rental Market Remains Tight

Vacancy rates remain near record lows at 1.6 per cent nationally. Advertised rent growth is running at 5.9 per cent on an annualised basis, which while easing slightly from the peaks of 2024 and 2025, is still well above long-term averages.

For renters considering buying, the maths is shifting. While higher mortgage rates increase monthly repayments, rents are also rising. In many markets, the gap between renting and buying has narrowed significantly, particularly when you factor in equity growth and tax benefits for owner-occupiers.

A Bright Spot: Expanded First Home Buyer Support

The overhauled Australian Government 5% Deposit Scheme (formerly the First Home Guarantee) is providing genuine relief for new buyers. Since 1 October 2025, the scheme now offers:

• Unlimited places (previously capped annually)
• No income caps (previously had income thresholds)
• Higher property price caps across many regions
• Broader eligibility: Anyone who has not owned property in the past 10 years can apply, not just strict first-time buyers

This means eligible buyers can purchase with just a 5 per cent deposit without paying lenders mortgage insurance — the government guarantees up to 15 per cent of the property value. Single parents can access the scheme with just a 2 per cent deposit.

What This Means for Buyers Right Now

The two-speed nature of the market creates different strategies depending on where you are looking:

• Perth, Brisbane, Adelaide: These markets are running hot but supply is beginning to edge higher. Do not panic-buy at the top, but equally, waiting for a significant correction in supply-constrained markets has historically been a losing strategy. Focus on quality properties with strong fundamentals
• Sydney, Melbourne: Buyers have more negotiating power than they have had in years. Higher listing volumes mean less competition at auction and more scope to negotiate on price. If you have been priced out of these markets, now may be a window worth exploring
• Regional areas: Some regional markets are still offering strong value, particularly in areas benefiting from infrastructure investment and remote work trends

Regardless of where you are buying, a mortgage broker can help you navigate the current rate environment, find the best deal across 30-plus lenders, and structure your loan to withstand further rate movements. Find a broker near you to get started.