Australia House Prices Slide as Market Downturn Spreads 2026

Australia house prices slide across major cities as the market downturn spreads, with new Cotality data revealing falls in Brisbane, Adelaide, and Perth. The national median home price now sits at $928,000, down about $19,000 from its March peak, signaling a broad cooling trend.

Key Cities Hit by Falling Home Values

Brisbane’s median price has dropped approximately $8,000 since May, returning to its March level of $1.1 million. This marks the end of a historic 40-month winning streak that began in February 2023. Adelaide and Perth have each seen median prices fall about $4,000 below their record highs, now at $944,000 and $1.03 million respectively.

Sydney, Melbourne, and Canberra have experienced even steeper declines, with median prices falling $69,000, $39,000, and $22,000 since February. Despite these drops, Sydney and Melbourne prices remain above their January 2025 levels, while Canberra is still higher than in September 2025.

Regional Australia Follows the Downturn

For the first time since January 2023, regional home values fell overall in June. In July, regional values either fell or stayed flat in every state, indicating that the slowdown is not confined to capital cities. This broad-based decline suggests a fundamental shift in market dynamics.

Factors Driving the Slide

The housing market has slowed since February, when the Reserve Bank of Australia (RBA) began hiking interest rates and the US conflict with Iran escalated. Housing demand has weakened further since the May federal budget trimmed property investors’ tax concessions. NAB reported a 15% fall in home loan applications from the first quarter to the June quarter, and Westpac, Equifax, and Loan Market have all noted declining mortgage demand.

RBA Governor Michele Bullock expressed surprise at the slump, noting that interest rates are only “a bit” restrictive. She attributed the slowdown to falling buyer sentiment rather than monetary policy alone.

Negative Equity Remains Low

Despite falling prices, the RBA reports that fewer than 1% of borrowers have fallen into negative equity, where home values are less than their loans. An even smaller share are unable to make repayments, suggesting that the financial stress is currently contained.

Comparison of Median Price Changes

Key Takeaways for Homebuyers and Investors

• National median price is $928,000, down $19,000 from March peak.
• Brisbane, Adelaide, and Perth saw first significant falls after long growth streaks.
• Regional Australia is now also experiencing value declines.
• Mortgage demand has dropped sharply, with NAB reporting a 15% fall.
• Negative equity remains rare, under 1% of borrowers.

What This Means for the Market

The downturn is likely to continue in the near term, especially if interest rates remain elevated or geopolitical tensions persist. For buyers, this could present opportunities, but for sellers, pricing strategies need adjustment. The RBA’s next moves will be crucial in determining the depth of the correction.

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