SYDNEY
Australia's median property value has fallen 3.6 percent since its March peak, with Sydney down 7.1 percent from February 2026 highs and Melbourne off 5.3 percent from October 2025 levels. The decline reflects tightening credit conditions across major markets.
The downturn has created distinct winners and losers. Upsizers are capitalizing on the price compression: a property that fell 20 percent from $2 million to $1.6 million meaningfully narrows the gap to their existing $1 million home, making the upgrade economically feasible. Sydney suburbs have recorded single-property declines of $600,000, according to Sina Enayati, director of FinSavvy.
First homebuyers with sufficient deposits are also entering the market. The Australian Bureau of Statistics reported 29,319 first home buyer loan commitments in the June 2026 quarter, as lower prices open entry points previously out of reach.
But the market has a hard floor. Brokers note that benefits accrue only to buyers with 20 percent deposits or existing equity. Long-term property owners unaffected by price moves are in a "maintenance phase," with many refinancing or switching to interest-only terms, according to Enayati.
The real vulnerability: recent purchasers who used the federal government's 5 percent deposit scheme now risk negative equity. Jacob Nutt, founder of QuickPath Lending, cautioned that many of these buyers—despite entering the market—face losses if values continue to slip below their purchase price.
