Buyers Hesitate, But Act: Sydney’s Property Market Continues to Heat Up in 2026 —Sydney Auction Clearance Rate at 79%

Week’s Key Focus

In 2025, the nationwide increase in housing prices exceeded the expectations of most people, and this upward momentum has continued to strengthen into 2026. Key factors driving the market’s heating include lower borrowing costs attracting more buyers, the return of investors, and many homeowners choosing to upgrade their properties. At the same time, government support policies for first-home buyers have further stimulated demand, intensifying market competition.

On the supply side, a shortage of housing has become a major driver of rising prices, particularly in cities such as Brisbane, Adelaide, Perth, and Darwin. Although listing volumes have rebounded in some areas, overall supply remains below historical averages. In addition to limited properties for sale, rental vacancy rates are at extremely low levels, further worsening the supply–demand imbalance. Data from Westpac–Melbourne Institute shows that while most people believe now is not a good time to buy, 75% of respondents still expect housing prices to continue rising over the next year. This expectation has encouraged many buyers to enter the market earlier.

From a long-term perspective, most cities have experienced strong growth since the early 2020s, with only Melbourne and Hobart showing relatively moderate performance. Melbourne’s demand has been restrained by pandemic lockdowns and interest rate hikes, while Hobart had already experienced significant price growth earlier. Looking ahead to 2026, Brisbane, Perth, and Adelaide are still regarded as the most promising markets, benefiting from population growth driven by internal migration and limited housing supply. Darwin, with its relatively low property prices and high rental yields, has also attracted renewed investor interest.

Overall, the market is expected to see national housing prices rise by around 4% to 7% in 2026. Price growth in Brisbane, Adelaide, Perth, and Darwin is likely to exceed the national average, while Sydney and Melbourne may track close to the national level. Hobart and Canberra are expected to record more moderate increases. Despite a strong start to the year, price growth may gradually slow as macroprudential policies tighten and interest rates potentially rise in the future. As economist Cameron Kusher has noted, against the backdrop of high household debt and declining affordability, first-home buyers without family or government support will find it increasingly difficult to enter the market.

Auction Results Last Week

Sydney: A total of 485 properties were taken to auction, with results reported for 263 properties. Among them, 208 were sold, resulting in a clearance rate of 79%. The total auction value reached AUD 258,603,559, with a median price of AUD 1,386,944.

Melbourne: A total of 595 properties were taken to auction, with results reported for 411 properties. Of these, 304 were sold, achieving a clearance rate of 74%. The total auction value amounted to AUD 213,505,038, with a median price of AUD 852,000.