Report | Intelligent Investment

Australian Residential Valuer Insights Q2 2026

Market insights on the residential real estate landscape in Australia, drawing on 165 CBRE valuers surveyed in May 2026 across New South Wales, Victoria, Queensland, Western Australia, South Australia and the ACT.

June 8, 2026 15 Minute Read

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Interest rates are the primary driver of Australia’s residential property market performance over the 12 months to Q2 2027, identified by 44% of CBRE Valuers, followed by proposed changes to Capital Gains Tax (CGT) and Negative Gearing at 28%, and affordability constraints at 17%. 

 

Proposed CGT and Negative Gearing changes are expected to place downward pressure on prices or have a neutral impact in the short term, while contributing to rent increases over the same period. For CGT, 63% of CBRE Valuers expect rents to rise over the 12 months to Q2 2027, while for Negative Gearing, 67% expect rents to increase, with both measures supporting development activity in the longer-term outlook. 

About the Report  

This report analyses residential property market conditions across Australia in Q2 2026 using 165 responses from CBRE Valuers, with comparisons to Q1 2026, Q2 2025 and Q2 2024. The report also assesses the expected impact of the Federal Budget announcements of 12 May 2026 on Capital Gains Tax and Negative Gearing. 

What are the key findings for Australia's residential market in Q2 2026?    

The following findings summarise the Q2 2026 survey results across demand, pricing, supply and buyer activity. 

  1. Demand has moderated

    In Q2 2026, 30% of CBRE Valuers reported ‘strong’ to ‘very strong’ demand, down from 54% in Q1 2026 and aligning with 28% in Q2 2025. Demand is strongest in Adelaide and Perth, with softer conditions in Sydney Outer Metro and Canberra. 

  2. First home buyers remain the most active buyer group

    First home buyers were identified by 70% of CBRE Valuers as the most active buyer type, followed by upgraders (52%) and local investors (49%), with a decline in investor activity compared to Q1 2026. ;

  3. Demand has increased for new houses

    In Q2 2026, 44% of CBRE Valuers reported increased demand for new houses, while demand for established houses remained solid but moderated. 

  4. House price expectations have shifted materially

    29% of CBRE Valuers expect house prices to increase over the 12 months to Q2 2027, while 41% expect price declines. 

  5. Apartment price expectations have softened 

    28% of CBRE Valuers expect apartment values to increase over the 12 months to Q2 2027, while 31% expect prices to remain stable and growth expectations are strongest in Adelaide, the Gold and Sunshine Coasts, and Brisbane Metro.

  6. Vacant land values are expected to be more stable 

    35% of CBRE Valuers expect vacant land price growth over the 12 months to Q2 2027, down from 68% in Q1 2026 and 54% in Q2 2025, while 40% expect values to remain stable. 

  7. Future demand expectations have weakened 

    Only 15% of CBRE Valuers expect demand to increase over the 12 months to Q2 2027, while 46% expect no change and 39% expect a decline.  

  8. Supply is expected to increase 

    50% of CBRE Valuers expect listings to rise over the 12 months to Q2 2027, up from 46% in Q1 2026, while 41% expect no change. 

What is the state of Australia's residential market in Q2 2026? 

Australia’s residential market in Q2 2026 is characterised by weaker demand and increased policy uncertainty compared with Q1 2026. In Q2 2026, 30% of CBRE Valuers reported strong demand, while 24% reported soft or very limited demand, up from 4% in Q1 2026, with 45% describing conditions as moderate. 

The moderation in demand reflects the combined impact of higher interest rates, policy uncertainty following the 2026 Federal Budget announcements, and broader geopolitical conditions. 

Market conditions vary across cities. Adelaide and Perth continue to record stronger demand, while Sydney and Melbourne show weaker sentiment and greater sensitivity to interest rates. 

How will the Federal Budget's CGT and Negative Gearing changes affect Australia's residential market? 

Proposed changes to CGT and Negative Gearing are identified by 28% of CBRE Valuers as a key influence on residential market performance over the 12 months to Q2 2027. 

For prices, 50% of CBRE Valuers expect CGT to place downward pressure on values, while 48%–52% expect price declines under Negative Gearing. 

For development, 42% of CBRE Valuers expect CGT changes to support activity over the longer term, while 48% expect the same outcome from Negative Gearing. 

For rents, 63% of CBRE Valuers expect CGT changes to increase rents over the 12 months to Q2 2027, while 67% expect rent increases under Negative Gearing, rising to 72% under both measures in the longer-term outlook. 

Which Australian cities have the strongest residential demand in Q2 2026? 

Adelaide and Perth have the strongest residential demand in Q2 2026, with the highest proportion of CBRE Valuers reporting ‘strong’ or ‘very strong’ conditions. Sydney Outer Metro and the ACT have the weakest demand conditions. 

Adelaide’s performance is supported by low housing supply, population growth, migration and relative affordability compared with eastern-state capitals. 

What property types are gaining or losing demand in Q2 2026? 

Demand has increased for new houses in Q2 2026, with 44% of CBRE Valuers reporting higher demand compared with 34% in Q1 2026, while demand for established houses remained solid but moderated.  

Demand remained stable for vacant land and recently renovated properties in Q2 2026.  

The largest decline in demand was observed for unrenovated properties and properties in secondary locations. Weaker demand was also recorded for prestige homes, with 28% of CBRE Valuers reporting declining demand, up from 16% in Q1 2026. 

Who are the most active residential property buyers in Australia in Q2 2026? 

First home buyers remain the most active buyer group in Q2 2026, followed by upgraders and local investors. 

First home buyer activity is highest in the Gold and Sunshine Coasts, Canberra and Melbourne Metro, while upgraders are most active in Sydney Metro, Perth and Canberra. Local investors are most active in Perth, the Gold and Sunshine Coasts and Brisbane Metro. 

What are Australian residential price expectations for the next 12 months to Q2 2027? 

Price expectations weakened across all property types between Q1 2026 and Q2 2026. 

For houses, 29% of CBRE Valuers expect prices to increase, 30% expect stability and 41% expect declines, with most declines expected to be less than 5%. 

For apartments, 28% expect price growth, 31% expect stability and 41% expect declines. 

For vacant land, 35% expect price growth, 40% expect stability and 25% expect declines, with the strongest growth expectations in Adelaide, Perth and Brisbane Metro. 

What is the outlook for Australia’s residential market in the 12 months to Q2 2027? 

Demand expectations weaken in the outlook to Q2 2027, with only 15% of CBRE Valuers expecting demand to increase, compared with 53% in Q2 2025, while 46% expect no change and 39% expect demand to decrease.  

Supply increases over the same period, with most CBRE Valuers indicating that listings will rise while 41% expect supply to remain stable.  

Rent pressures persist, with 63%–67% of CBRE Valuers expecting rent increases over the 12 months to Q2 2027, rising to 72% in the longer-term outlook.

What are CBRE Valuers saying on the ground in Q2 2026?

“Well-located properties with favourable attributes, including functional layouts, level land, good presentation, and proximity to transport, schools, and town centres, continue to attract solid buyer interest and relatively stable pricing outcomes.”

Rouse Hill, NSW

“Demand remains strong, particularly for two and three-bedroom apartments, renovated houses, and vacant land.”

Hornsby, NSW
“Well-located family homes continue to attract demand when priced well, while secondary stock is taking longer to sell. Buyers are more selective due to elevated interest rates, tighter borrowing conditions and affordability pressures.” 
Inner East Melbourne, VIC
“Demand for vacant land has softened as rising construction and building material costs continue to impact new home feasibility.” 

Inner Melbourne, VIC
“The residential market on the Gold Coast is on an upward trajectory and will likely continue despite these CGT and negative gearing changes. Rents will likely increase in the longer term to claw back some investment returns.” 

Gold Coast, QLD

“There is high demand for sub million-dollar properties. Increase in demand and sale prices has been noted for modern units.” 

Sunshine Coast, QLD. 
“Agents are reporting that houses are remaining on the market slightly longer than previously however demand remains strong at present.” 

South East Perth, WA

“Recent interest rate increases, Federal Budget announcements, and the continued rise in the cost of living are impacting buyer and tenant activity. This is particularly evident in the $1.50m+ market segment, where local agents report distinct falling demand and reduced buyer capacity to meet seller expectations.” 

North East Perth, WA
“Adelaide’s overall market remains resilient, underpinned by low housing supply, population growth, migration, and affordability relative to eastern-state capitals.” 

West Adelaide, SA

“The local market continues to demonstrate generally stable demand levels, although some segments are experiencing slightly extended selling periods. Well-presented properties in desirable locations continue to attract reasonable buyer interest.” 

Barossa, SA
“There is a noticeable increase in investor-grade apartment stock entering the market, with widespread discounting on asking prices to attract home buyers, as activity is now largely driven by owner-occupiers."

Canberra, ACT

“The prestige sector has seen early signs of softening with a reduction in buyer participation and confidence, particularly with properties warranting significant capital expenditure.”  

Canberra, ACT
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