Time for a breather? Property slowdown tipped
At a time when rising property prices are quashing the dreams of many would-be homeowners, experts are predicting a levelling out in 2026.
REAL estate guru John McGrath has joined other experts in suggesting Australia’s supercharged property market could cool off somewhat in 2026.
“It’s going to have to take a breather soon, because you can’t just keep going with double-digit increases year in, year out,” McGrath tells the latest edition of Australian Conveyancer’s Settlement Day podcast.
“There’s either going to be a problem, or there’s going to be a breather. I think there’ll be a breather.”
Among the factors is the RBA’s decision to keep the interest rate on hold at 3.6%, with some economists tipping a rise rather than a fall in the New Year.
“I think that’s cooled the market a bit,” McGrath added. “I think people are just not getting too carried away, which is a good thing.”
Others suggest inflation, high prices, unemployment, tighter lending criteria and an immigration slowdown could also help rein in activity.
McGrath sees the top end of the market remaining strong, with any hesitation mainly in the entry-level range.
Government incentives for first home buyers might help, but “The problem is, of course, that it often pushes prices up by the same amount, inevitably, as the incentive.”
McGrath suggests first home buyers in Sydney consider apartments in Newcastle or Wollongong, because buying a house in inner Sydney has “almost become an unreachable goal.”
“We’re looking at $2 to $4 million in that inner ring within 15, 20km of the CBD,” he says.
McGrath feels established investors should look at Melbourne in 2026. Dwellings there rose only 3.3% in the past year and could take off.
“I think if you’re looking for value, if you want to make money in the next 3 or 4 years, Melbourne is probably the best place,” he said.
McGrath was joined on the panel by tech titan Christian Beck and top property lawyer Jared Zak, of Dott & Crossitt.
View the full podcast here:
