Investment Report – May 2026

Australia’s housing market is diverging at pace. The gap between high-growth markets and those losing momentum has widened further through the first four months of 2026.

Perth leads all capital cities with annual price growth accelerating to 26%, supported by a vacancy rate of just 0.5% and supply constraints that show no sign of easing. Brisbane and Adelaide continue to push higher at 18% and 12% respectively. Sydney and Melbourne tell a different story, slowing to approximately 4% and 2% – though Melbourne’s softer performance may present relative value over the medium term as the cycle turns.

Rental markets remain constrained nationwide with vacancy rates below 1.5% in every capital city. The macroeconomic environment has tightened materially – headline inflation at 4.6%, the cash rate back at 4.35% following three consecutive hikes, and proposed CGT and negative gearing changes adding further uncertainty.

All markets are expected to moderate, but unevenly. Market selection has never been more important.