Australia’s property market remained resilient in May, supported by easing inflation, stable interest rates, and improving consumer sentiment. While buyer confidence is gradually returning, market conditions continue to vary across capital cities.

Key Economic Indicators

• Inflation (CPI): 4.2% – Inflation remains above the RBA target range but continues its downward trend, supporting expectations of future rate cuts.
• Cash Rate: 4.35% – The RBA maintained the cash rate, providing stability for borrowers and investors.
• Consumer Confidence: 66.35% – Sentiment improved as households adjusted to the current interest rate environment.

Auction clearance rates were generally stable across major cities: Sydney held steady at 54%, Melbourne improved slightly to 55%, Adelaide remained the strongest performer at 56%, Brisbane recorded a softer result at 27%, down from 40% in April, Canberra eased to 48% from 53% previously. The results suggest buyers remain active but selective, with affordability continuing to influence purchasing decisions.

Rental conditions remained tight across Australia in May, with vacancy rates staying near historic lows in most capital cities. Strong population growth and limited housing supply continue to support rental demand, particularly in Brisbane, Adelaide and Perth, where vacancy rates remain below 1%. These conditions are helping sustain rental growth and reinforcing the strong fundamentals of the residential 

Daily Home Value Index shows property prices continue to rise across most markets: Perth remains the standout performer, delivering the strongest annual growth. Brisbane continues to record robust price increases. Adelaide maintains solid momentum. Sydney and Melbourne are experiencing more moderate growth as affordability constraints limit stronger price appreciation.

Overall, Australia’s property market remains underpinned by limited housing supply, population growth, and a tight rental market. While higher interest rates continue to moderate buyer activity, improving confidence and expectations of future monetary easing are supporting market stability. Growth is expected to remain strongest in supply-constrained markets such as Perth, Brisbane, and Adelaide, while Sydney and Melbourne are likely to see steady but more measured performance throughout the remainder of 2026