Australia’s property market shifted into a more moderate phase in June, as home values recorded their third consecutive monthly decline nationally, led by Sydney and Melbourne. Easing inflation and a steady cash rate continued to support sentiment, and consumer confidence improved further, but conditions diverged sharply between the softening major capitals and the still-strong mid-sized markets.

Key Economic Indicators

• Inflation (CPI): 3.8% – Down from 4.2% in May, inflation continued its downward trend, reinforcing expectations of future rate cuts.
• Cash Rate: 4.35% – The RBA held the cash rate steady for another month, maintaining stability for borrowers and investors.
• Consumer Confidence: 77.5 – Sentiment strengthened further from May as households responded positively to the RBA’s decision to leave rates on hold.

Auction clearance rates softened across most major cities in June. Sydney eased to 49% from 54% in May, Melbourne held firm around 56%, Adelaide moderated to 43% from 56%, Brisbane recovered to 37% from 27%, and Canberra held steady at 48%. The softer results reflect higher listing volumes and more cautious, price-sensitive buyers through the winter selling season, with affordability continuing to shape purchasing decisions.

Rental conditions remained tight across Australia in June, though vacancy rates ticked slightly higher in several capitals. Sydney and Melbourne both rose to 1.6%, while Brisbane (0.9%), Adelaide (0.7%) and Perth (0.6%) stayed at or below 1%. Strong population growth and limited housing supply continue to underpin rental demand, particularly across the mid-sized capitals, sustaining rental growth and reinforcing the strong fundamentals of the residential sector.

The Daily Home Value Index revealed a clear divergence in June. Perth remained the standout performer with annual growth of 23.9%, followed by Brisbane at 17.4% and Adelaide at 11.6%. Sydney slowed to just 0.3% annual growth and recorded a 3.2% decline over the quarter, while Melbourne fell 0.9% over the year and 2.6% over the quarter, as affordability constraints and higher interest rates weighed on the two largest markets.

Overall, Australia’s property market entered a more measured phase in June, with national values easing from their March 2026 peak. While Sydney and Melbourne are now seeing modest declines, the supply-constrained capitals of Perth, Brisbane and Adelaide continue to deliver strong growth, supported by tight rental markets and robust population growth. With inflation easing and expectations of future monetary easing building, the market is expected to remain fundamentally resilient — though performance will stay uneven, favouring supply-constrained markets through the remainder of 2026.