Property Update - January 2026

Monthly highlights
 

• The quarterly rate of increase in national home values rose from 2.5% in Q3 to 2.9% in Q4, but the monthly trend was starting to ease through the final months of 2025.

• The pace of growth in home values lost some steam through the end of 2025 and into the early months of 2026. Sydney and Melbourne recorded a subtle decline in dwelling values, while growth conditions eased across the other capitals.

• Monthly home sales tend to show extreme seasonality in December and January, however the annual trend shows a 4.9% increase in the number of home sales nationally. The rise was mostly driven by regional parts of the country, where the estimated volume of home sales was 8.1% higher in 2025, compared with a 3.2% rise in volume across the combined capitals.

• The trend in total listings picked up a little through spring, but not as much as the flow of new listings, highlighting a strong rate of absorption as buyers remained active and homes sold relatively quickly. The four-week count of advertised supply ended the year nearly 16% down on the same time last year to be 20.6% below the previous five-year average for this time of the year

• The national rental index increased by 5.2% in 2025, a step higher from the 4.8% rise in rents seen through 2024, but well below the 8%+ annual increase in rents recorded between 2021 and 2023. The rental vacancy rate tightened compared with 2024, reducing from 2.1% to 1.7% by December 2025. Rents have increased across every broad region of Australia, ranging from a 10.1% jump in regional WA to a 2.9% increase in Melbourne.

• The total value of investor lending rose 17.6% over the quarter and 17.7% over the year to $39.8 billion. Investors accounted for 40.6% of the value of total loan commitments in the September quarter, the highest level since the three months to December 2016 (40.7%) and well above the 33.4% average seen over the past decade. The ACT (+23.2%) and NSW (+20.4%) saw the largest increase over the quarter, followed by Victoria (+16.3%), NT (+15.9%) and QLD (+15.2%).

• APRA announced a new round of credit tightening, with the new macroprudential policy set to go into effect in February, imposing a 20% limit on high debt -to -income (DTI) lending for new loan originations, measured across owner occupier and investor lending separately. While the portion of loans originated with DTI of six or more remained contained at 6.1% in September, this was the highest portion of high DTI lending since the June quarter of 2023. Other lending metrics that might be considered higher risk also rose, with interest only lending now comprising 20.9% of ADI home loan originations in Q3 and high loan -to -income ratio lending rising to 3.3% of originations.

Download the report here (PDF 5MB)