Welcome to Opteon’s Property Pulse Check, our quarterly take on Australia’s evolving property markets. This edition captures fresh insights for the third quarter of 2026 from our valuation experts across residential, retail, office and industrial sectors, revealing where markets are holding steady, gaining pace, or beginning to cool. It’s a succinct snapshot of buyer and seller sentiment across the country.
Tracking the rhythm of Australia's Property Markets
Our quarterly Pulse Check offers a quick read on the health of Australia’s property markets, using a familiar metaphor: the heartbeat. Just like a pulse can signal calm, exertion, or fatigue, market conditions vary by region and sector. We’ve asked our experts to assess the rhythm of their local markets this quarter, whether it’s resting, elevated, or slowing. Their insights provide a timely snapshot of buyer and seller sentiment, helping you stay in step with the changing pace of the property landscape.
- Resting Pulse – The market is steady and well balanced, ticking along at a healthy pace.
- Elevated Pulse – Activity is ramping up, with strong demand pushing the market into growth mode.
- Slow Pulse – Momentum is easing as the market takes a breather after a busy run.
This quarter, the residential downturn broadened, with national dwelling values down 3.7% over the September quarter and 5.2% below their March peak. Nearly every capital city recorded a decline, though regional markets and some smaller capitals held firmer. Commercial conditions told a more varied story: industrial continued to show positive momentum, retail held resilient underlying fundamentals despite softer consumer confidence, and office sentiment began to stabilise after a prolonged period of repricing.
Here’s what our experts are seeing on the ground this quarter:
The Australian retail sector continues to demonstrate resilient underlying performance, supported by ongoing population growth, low vacancy levels across most retail formats and a persistent undersupply of new retail floorspace. Elevated construction and development costs continue to act as a barrier to new supply, maintaining a significant gap between existing rental levels and replacement cost. These structural factors are expected to support continued rental growth and positive re-leasing spreads through 2027.
Despite these favourable market fundamentals, consumer confidence remained subdued during the September quarter. The Westpac–Melbourne Institute Consumer Sentiment Index declined 4.7% to 80.4 in October down from 84.4 in September 2026, reflecting ongoing cost-of-living pressures, higher fuel prices and concerns upcoming future interest rate movements with household discretionary spending likely to continue to be under pressure.
Development activity remains constrained by elevated construction costs, labour shortages and feasibility challenges. As a result, the pipeline of new retail supply remains limited across both shopping centre and large-format retail sectors, reinforcing favourable occupancy conditions for existing assets.
The Australian retail property sector continues to demonstrate resilience, supported by low vacancy levels, constrained new supply and ongoing population growth. While consumer confidence remains subdued, retail assets have generally maintained solid occupancy, stable income growth and strong investor appeal, particularly across convenience-based and large format retail formats.
The Australian office market remains challenged and conditions continue to vary significantly by asset quality and location. While elevated vacancy rates and subdued activity in secondary assets continue to weigh on the sector, market sentiment has improved in recent months as pricing stabilises, investment activity increases and occupier demand shows signs of recovery.
Tenant preference remains firmly focused on high-quality, well-located buildings with strong sustainability credentials, supporting premium assets while older stock continues to face leasing challenges. Capital values have generally stabilised following a prolonged period of repricing and, with future supply constrained by limited development activity, the medium-term outlook is improving for prime office assets
The Australian industrial property market is demonstrating positive momentum, supported by strong occupier demand, moderating supply and resilient investment activity. National vacancy stands at 4.6%, with quarterly gross take-up reaching 1.49 million sqm. Rental growth remains positive across most markets, with Perth recording the tightest vacancy and Adelaide the strongest rental growth.
Investment demand remains robust, reflecting continued institutional and private investor appetite, while yields are broadly stable. Looking ahead, the outlook remains positive, with modern, well-located prime assets expected to outperform secondary stock as vacancy tightens and effective rental growth strengthens.
The housing downturn broadened sharply in Q3, with national dwelling values ending September -5.2% below their March peak, driven by reduced borrowing capacity, elevated living costs and weaker buyer sentiment. National values fell -3.7% over the quarter, with 97% of capital-city suburbs recording declines, although regional markets remained comparatively more resilient.
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George Garagounis 0427 786 918
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New South Wales
Sydney sales volumes were down 26.5% on a year earlier, the weakest of the capitals. Total listings were up more than 11% while new listings fell sharply, as vendors held back and stock sat longer on the market. Capital city clearance rates stayed below 50% through spring, and homes took a median 39 days to sell, up from 23 a year ago.
Regional NSW again outperformed: values softened 2.2% over the quarter but are still up 3.4% for the year. Sydney rents kept rising, with houses up 4.9% and units up 3.7% annually.
Victoria Victoria’s downturn continued through the quarter, though at a gentler pace than Sydney. Melbourne values fell 0.7% in September and 3.4% over the quarter, leaving them 6.2% lower for the year, with a median dwelling value of around $781,000. Selling conditions remained tough. Melbourne total listings were up more than 14% on a year earlier while new listings fell nearly 14%, so buyers had plenty of choice and little urgency.
Higher rates, the September RBA hike, affordability pressures and reduced investor demand following tax changes all weighed on the market. Regional Victoria held up better, easing only 1.3% over the quarter and remaining 3.6% higher for the year. Melbourne rents continued to climb, with houses up 4.9% and units up 4.8% annually, supporting yields of around 4.1%.
Australian Capital Territory Canberra joined the broader correction over the quarter, with values falling 3.2% and 1.1% in September alone. Over the year values are down a more modest 1.6%, a far smaller decline than in Sydney and Melbourne, and the median dwelling value sits at around $862,000. Higher interest rates, the RBA increases and weaker buyer confidence slowed demand, although Canberra’s stable public sector employment base helped cushion the falls.
Rental growth was softer than in other capitals, with houses up 3.8% and units up only 1.5% annually, but gross yields of around 4.4% remain among the strongest of the capitals. |
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Regional Director 0407 332 887 |
South Australia Adelaide’s residential property market has shifted from slowing growth to declining values. After record growth in recent years, dwelling values fell 2.7% over the September quarter, while annual growth remained at 6.5%. The quarterly decline was largely driven by anticipated interest rate rises, changes to CGT-related policies and affordability pressures as living costs increased. Sales volumes were 4.67% lower than a year earlier, and days on market rose 3%. Rents increased 6.3% over the year, with yields around 3.6%.
Regional SA outperformed metropolitan Adelaide, recording growth of 1.7% in the September 2026 quarter and 10.7% annually. Regional sales rose 1.2% over the year, while days on market fell from 47 to 45 days. The regional rental market remained strong, with annual rental growth of 4.5% and yields around 4.4%. Slower investor enquiry in Regional SA has reduced competition, creating opportunities for first homebuyers to enter the market. |
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State Director 0457 456 355 |
Queensland The Brisbane residential property market entered a clear correction phase during the past quarter. Overcoming years of record-breaking growth, Brisbane dwelling values fell 1.5% in September alone, representing the sharpest monthly decline among Australian capitals.
Consequently, total advertised listings surged 60.4% year-on-year as homes stayed on the market longer, shifting leverage toward buyers. Meanwhile, the rental sector remained severely constrained with a vacancy rate under 1% |
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State Director 0417 449 344 |
Western Australia Perth’s residential property market is in a correction phase with dwelling values decreasing -1.2% in September, -4.7% over the September quarter, and 10.1% increase over the past 12 months. Values are now 6.0% below their April 2026 peak. While market activity has moderated, with sales volumes down 18.8% over the year, conditions remain slow...but steady.
The supply of listed properties has increased by 64.7% over 12 months, and the median time taken to sell a home has risen to 26 days. Selling days have more than doubled from the same period last year (11), indicating reduced buyer urgency and demand. Increased housing supply has also resulted in higher vendor discounting, with sellers negotiating an average of -4.8%, compared to -2.7% in the September quarter of 2025.
Northern Territory Darwin’s residential market has slowed somewhat with dwelling values increasing 0.4% in September 2026, 0.5% over the quarter, and 11.9% over the past 12 months. The supply of listed properties increased 18.1% from the equivalent period last year and buyer demand has been steady with sales volumes -1.6% lower over the year to September 2026. While the general housing market has slowed, performance has been steady in rural and unit markets with the lower, more affordable end of the market performing strongest. Darwin rental values have risen 11.6% in 12 months and 5.1% in Regional NT with the strongest rental yields in the country of 6.5% and 8.0% respectively. |
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State Director 0409 232 104 |
Tasmania Tasmania's housing market continues to show steady growth, with Hobart's residential dwelling values rising 0.6% in June, 1.4% over the June quarter and 9.3% over the past 12 months. While values remain below the market peak, Hobart is now just 0.7% below the record high reached in March 2022. Total listed stock levels are 24.4% lower than a year ago, highlighting ongoing supply constraints, while median days on market increased slightly to 31 days from 30 days a year earlier. Vendor discounting has widened to -3.8%, reflecting more balanced market conditions and greater buyer negotiation compared to last year.
Rental rates have increased 8.6% over the past 12 months, supported by tight vacancy conditions and limited housing supply. Regional Tasmania continues to perform strongly, with dwelling values increasing 13.0% over the past 12 months, outpacing Hobart's annual growth. Sales activity remains robust, with transaction volumes up 9.3% year-on-year, while total advertised listings are 27.1% lower than a year ago, indicating exceptionally tight supply conditions. Rental values have risen 10.1% over the past 12 months and gross rental yields remain attractive at 4.4%.
Regional centres continue to benefit from lifestyle appeal, affordability relative to mainland markets, and limited housing stock, providing ongoing support for both capital growth and rental market performance. |
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