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A recent report from Canstar anticipates Sydney’s median house price to climb by $154,000 by the end of 2026, spurred by this year’s spring selling season.
This comes from the analysis of a Westpac report that claimed Sydney dwelling prices will rise by 5 per cent in 2025 this year and a further 8 per cent next year.
This means the median house price in the NSW capital would reach $1,675,827 by December 2026.
While Sydney is expected to be hit the hardest by the surge in activity, other capitals are to be affected too.
Melbourne’s median house price is predicted to increase by $103,505, to a total of $1,059,810.
Brisbane’s median house price is expected to reach $1,134,066, an increase of $93,415, and Perth’s could climb $102,250, to a median of $984,117.
Canstar’s data insights director, Sally Tindall, said this surge in prices is likely to make the deposit hurdle for borrowers a “whole lot steeper” and make meeting serviceability requirements much more difficult.
“Melbourne’s median house price is tipped to crack the million-dollar mark. For many first home buyers, that psychological barrier will feel like the goal posts keep moving further away,” said Tindall.
“Even with interest rates heading south, there’s no relief for house hunters if prices keep climbing at this pace. The extra borrowing power from lower rates risks being swallowed whole by rising price tags.”
Cotality is also preparing for a very active spring season. Reduced interest rates, a lift in borrowing capacity, wage growth, and rising confidence are expected to spur confidence into borrowers.
However, according to Cotality Australia’s research director, Tim Lawless, supply and affordability challenges could keep these trends from blowing out of proportion.
“The annual trend in estimated home sales is up two percent on last year and tracking almost 4 per cent above the previous five-year average. At the same time, advertised supply levels remain about -20 per cent below average for this time of the year,” he said.
The ones who will see the most benefit over the spring season are vendors. They have a perfect storm of confident and capable buyers who will have a sense of urgency as supply challenges persist.
Brokers too should expect a busy spring season. A mix of government incentives, economic recovery, buyer confidence, and seasonal trends is all converging to prime the housing market for immense activity.
[Related: 10 spring selling season hacks: How to win in a hot market]
