Your Mid-Year Market Update — Rates Paused, Property Splits Two Ways
We're just past the halfway mark of 2026, and there's plenty happening across the property and finance markets. Here's a plain-English rundown of where things stand — and what it could mean for you.
Property: a tale of two markets
Australia's housing market has well and truly split in two. Nationally, home values dipped 0.4% in June — the largest monthly fall since late 2022 — with Sydney and Melbourne leading the softening as higher borrowing costs and stretched affordability take their toll. Even so, national values remain around 7% higher than a year ago.Meanwhile, the smaller capitals keep powering ahead. Brisbane reached a fresh peak in June, with values up more than 17% over the year (units alone rose over 20%), and Adelaide has climbed around 12% annually, its median dwelling value now nudging $950,000.For buyers, conditions are the friendliest they've been in some time: listings are up on last year, homes are taking longer to sell, and vendors are discounting more — meaning greater choice and real room to negotiate. For investors and landlords, rental demand remains exceptionally strong, with national rents up 5.9% over the past financial year, adding roughly $40 a week to the median rent.
Finance: rates paused, but the story isn't over
After three rate rises earlier this year took the cash rate to 4.35%, the Reserve Bank hit pause at its June meeting — its first hold of 2026 — to let those increases work through the economy. Inflation is still running at around 4%, above the RBA's 2–3% target, so the Board is keeping its options open.All eyes now turn to the quarterly inflation figures on 29 July, which will heavily influence the RBA's next decision on 11 August. The big banks are split: Westpac sees the cash rate potentially peaking at 4.85%, while ANZ, CBA and NAB expect rates to stay on hold — and none are forecasting cuts before 2027.One practical effect worth knowing: this year's rate rises have trimmed borrowing capacity by roughly $36,000 for an average income earner — around $72,000 for a dual-income couple.
What this means for you
If you have a loan, now is a smart time to review your rate — lenders are competing hard for refinancers, and a sharper deal can claw back much of this year's increases. If you're buying, softer conditions in some markets are creating genuine negotiating power. And if you're an investor, keep the changes to negative gearing on established properties (from 1 July 2027) on your radar — planning ahead will matter.Every situation is different, and we're here to help you make sense of yours. Simply reply to this email or call us on [phone number] to book a complimentary chat.
This update is general information only and doesn't take into account your personal objectives, financial situation or needs. Please consider its appropriateness for your circumstances and seek professional advice before acting. Market data sourced from Cotality, the RBA and major bank forecasts, July 2026.
