The team at Finwell Group has researched the views of experts in Australia about key property investment trends in the coming year. As we roll into 2026, now is the time for anyone interested in property to set their goals and start putting plans into action. Taken broadly, most experts predict strong property growth in 2026, driven by a combination of interest rate stability, persistent housing undersupply, growing first-home buyer demand, and tight rental markets. Predictions for Australian interest rates in the first half of 2026 are mixed, with some major banks like ANZ and Westpac forecasting an extended hold at the current cash rate (around 3.60%) due to persistent inflation, while others, including CommBank and NAB, have shifted to predicting one or even two rate hikes (potentially to 3.85%) by mid-year, driven by inflation staying above the RBA’s target. In 2026, property values across Australia’s combined capital cities are widely predicted by economists and real estate experts to continue rising to new record highs, albeit at a slower and more modest pace than in 2025. The consensus forecast is for an average national increase of approximately 6% to 8%. AMP forecasts place 2026 home-price growth at 8–10%, citing rising wages and expanded low-deposit schemes. Meanwhile, ANZ projects capital city home prices will rise 5.8% by the end of 2026. KPMG’s outlook suggests that dwelling approvals remain below needed levels — only about 160,000 new homes per year vs. a national target of 224,000. This under-supply, paired with strong demand, is expected to maintain pressure on prices. When it comes to the rental market & vacancy predictions, CBRE says that vacancy rates could tighten further, potentially dropping as low as 1.1% in capital cities, fueling strong rental inflation. For investors, CBRE also suggest that they expect solid yield prospects given that demand for rental stock will remain elevated. KPMG also predicts that unit prices may outpace house prices in 2026 as affordability drives more buyers toward apartments and townhouses. Moving our attention to emerging investment themes, many experts suggest that strategic areas to watch include infrastructure-led growth corridors, such as around new metro lines or transport hubs. Analysts also highlight value in mixed-use developments, sustainable design, and smart-home enabled properties — particularly near major infrastructure projects. There are risks in the property market, in that affordability remains a major challenge. High house prices and large deposit requirements could limit some demand. KPMG insists that investors also face an execution risk if construction doesn’t accelerate enough to relieve supply constraints. The bottom line is that 2026 looks favourable for property investors in Australia. With expected rate cuts, tight supply, strong rental markets, and structural demand, there’s strong momentum. But rising prices and affordability pressures mean investors may be especially well-positioned in high-yield, supply-constrained markets or by targeting apartments in growth corridors. To get more information about the property market, understand how it affects you and discuss your personal options, you can have a chat with one of Finwell Group’s senior consultants. Book a free and no-obligation review meeting to discuss your needs and to see how we can help you. Call us on (03) 9017 3235 or email [email protected]
