July brought the sharpest monthly fall in home values since 2022, and it's no longer just Sydney and Melbourne. Here's the median dwelling price in every capital city, and what's driving each market.
Australia's housing downturn deepened sharply in July, with Cotality's national Home Value Index (HVI) falling 0.7%, the largest single-month decline since December 2022.
Until now, the slowdown had been mostly confined to Sydney and Melbourne. July's data shows it has spread further: Brisbane and Adelaide both recorded a second straight month of falls, pulled down by the same affordability and demand pressures that hit the two largest capitals first.
Cotality's August update, released this morning, shows the decline widening further: national values fell 0.9% for the month, the fifth straight monthly fall, and are now 3.6% below their March peak. Full city-by-city figures for August are not yet out, so the breakdown below is July's data, the most recent month with a complete capital-by-capital picture.
Sydney and Melbourne are still leading the declines, down 1.4% and 1.2% respectively for the month. Melbourne peaked in November last year; Sydney peaked in January. Brisbane fell 0.6% and Adelaide 0.2%, with Cotality's revisions showing both cities have now recorded two consecutive months of falls. Perth was the exception, edging up 0.1% after a downwardly revised 0.5% fall in June.
Some reporting has suggested Perth, Brisbane and Adelaide have overtaken Melbourne on median values. That comparison can mislead. Melbourne has close to double the proportion of units to houses compared with those other capitals, which drags down its "all dwellings" median regardless of how houses themselves are performing.
Median prices are a useful rough guide to affordability, but they move around from quarter to quarter based on whatever happened to sell, not necessarily on what any one property is worth. They work best in suburbs with a fairly uniform housing stock, such as a newer estate or a pocket of similar renovated homes. In a suburb with a wide mix, from busy-road houses to water-view properties, the median can undersell how different two similarly priced areas really are.
Sydney
Sydney values are 5.3% below their November 2025 peak, having weakened steadily through the year, though they are still up 9.5% over five years. The market is expected to soften further before any recovery once interest rates start falling in 2027.
Melbourne
Melbourne values are 5.3% below their March 2022 peak and down 1.6% over five years, the weakest five-year performance of any capital. A larger supply of listings relative to other states, and investor caution around Victorian government policy on tenancy and land tax, have weighed on the market. A Melbourne house is now the cheapest it has been relative to a Sydney house in around 20 years, and auction clearance rates have softened further in recent months.
Brisbane
Brisbane has risen 71.2% trough-to-peak over five years but is now 0.7% below its May 2026 peak. Demand for investment-grade homes remains strong, still outpacing supply, but price growth has clearly slowed from its earlier pace.
Adelaide
Adelaide recorded 68.5% trough-to-peak growth over five years, one of the strongest runs nationally, but the affordability edge that helped it outperform through the rate-hike years has now closed. Softening auction clearance rates point to a market that is stalling rather than reversing.
Perth
Perth remains the strongest capital for both monthly and annual growth, and values are at a fresh peak, after a decade of little movement followed by a sharp run-up over the past two years. That pace of growth is expected to moderate over the rest of 2026.
Hobart
Hobart, the standout market of 2017-18, remains the weakest capital on both annual growth and distance from its prior peak: values are still 0.7% below their March 2022 high, despite rising 14.4% over five years.
Darwin
Darwin remains the most affordable capital to buy a house in. Values are flat against their July 2026 peak after a 30.3% rise over five years.
Canberra
Canberra values fell 1% in July but are still 1% above where they sat a year ago. Over five years, houses are up 9.4%, though still 4.2% below their May 2022 peak. Subdued auction clearance rates over the past year point to ongoing softness.
What it means for buyers and investors
The story in July's data is that the downturn is broadening, not just continuing. Sydney and Melbourne have been correcting for months; Brisbane and Adelaide joining them signals that demand-side pressure, including higher borrowing costs, tighter serviceability and weaker consumer confidence, is now wide enough to affect markets that had held up well through the rate-hike cycle. Perth is the outlier, still growing, though Cotality expects that to slow too.
Median prices are a starting point, not the full picture. Two properties in the same city, even the same suburb, can sit a long way apart in value depending on land, aspect and quality. Anyone buying or selling in the next few months should weigh the metro-wide trend against what is actually happening in their specific suburb and price bracket.
Sources
Cotality, Australia's housing market downturn widens, Property Update, The latest median property prices in Australia's major cities, CoreLogic (unit share by city, not independently linked)
