Demand for new houses increases following proposed tax changes

Interest rates are expected to be the most significant driver of residential market performance in the year ahead, followed by proposed Capital Gains Tax and Negative Gearing changes, a new CBRE survey shows.

CBRE’s Residential Valuer Insights Q2 2026 surveyed CBRE’s Residential Valuers around Australia to provide expert insights on local and national trends.  

The survey showed Valuers reported increased demand for new houses at 44% in Q2, up from 34% last quarter.

Around a third of Valuers expect house values, apartment values and vacant land values to increase. However, this represented a significant decline in price growth expectations for houses this quarter with 29% of Valuers expecting growth compared to 70% in Q1 2026.

Just under a third of Valuers reported ‘strong’ or ‘very strong’ demand this quarter, down from 54% last quarter. Purchase demand is strongest in Adelaide and Perth, while demand in Sydney Outer Metro and Canberra is softer. 

When asked what will be the biggest influence on residential market performance in the next 12 months 44% of Valuers said they expect interest rates to be the primary influence.

A further 28% expect the biggest influence to be changes to CGT and Negative Gearing while 17% expect affordability to be a major factor shaping market conditions.

CBRE’s Pacific Head of Research Sameer Chopra said, “These insights from our Valuers are timely given the change in sentiment during May following the proposed changes to CGT and Negative Gearing which are now clearly influencing how prices, development and rents are being assessed. Our Residential Valuers expect some near-term softness in prices, alongside stronger rent growth and more supportive conditions for development over time.”

CBRE’s National Director of Residential Valuations Kat Hale said, “Across Australia, our Valuers are seeing demand moderate. There is still activity in the market, particularly from first home buyers and upgraders, but as demand slows and rents are expected to rise, this is likely to place pressure on rental supply and weigh on investor activity.”

First home buyers, upgraders, and local investors were again the most active buyer types this quarter. There has been a slight dip in down-sizer activity compared to last year, and a decrease in local investor activity compared to last quarter.