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Despite slower momentum in most capitals, home values across Australia have continued to rise, with Sydney and Melbourne posting modest gains after December declines.
Cotality’s Home Value Index for January showed that national home values rose by 0.8 per cent across the month to a median value of $912,465.
According to the data, the result marked a slight rise from 0.6 per cent in December, with every capital city and the rest of the state regions recording an increase over the month.
Meanwhile, the combined capitals recorded a 0.7 per cent value
Cotality’s research director, Tim Lawless, said despite the widespread rises, pressures on the property market were likely to quell momentum.
“The ongoing capital gains reflect persistently low inventory in the face of above-average housing demand; however, we are likely to see demand side pressures gradually ease in 2026,” he said.
He said demand would likely be dampened by affordability and serviceability constraints, renewed cost-of-living pressures, a chance of interest rates rising, and slowing population growth.
Sydney and Melbourne record slight pickup
Sydney and Melbourne recorded marginal increases in January, showing growth on the rise following slight drops in December.
According to the data, Sydney’s dwellings recorded a 0.2 per cent increase over the month to a median value of $1,290,537, while Melbourne’s values rose 0.1 per cent to $830,371.
Both markets were slightly down from their peaks, with Sydney 0.1 per cent below its November 2025 peak and Melbourne 0.7 per cent below its March 2022 record highs.
Growth slows in smaller capitals
Aside from Brisbane and Melbourne, home values across the rest of the capital cities showed sustained growth, but slowed momentum.
Perth recorded the strongest gain among the capitals, with home values 2.0 per cent higher in January, reaching a median dwelling value of $961,898.
However, the results were well below the market’s high of 2.9 per cent MoM (month-over-month) growth in November last year.
Similar to Perth, Brisbane’s monthly growth also slowed, dropping from 2.0 per cent in October last year to 1.6 per cent in January, recording a median dwelling value of $1,054,555.
Likewise, Adelaide’s monthly MoM growth fell to 1.2 per cent in January and a 1.8 per cent increase in December, resulting in a median dwelling value of $914,203.
Low-value homes fuel growth
Cotality noted that most cities were seeing homes at the lower end of the value spectrum, supporting growth, particularly for houses.
“Across the combined capitals, lower quartile house values were up 1.3 per cent in January compared with a 0.3 per cent rise across the upper quartile,” the report said.
Lawless said that the trend of stronger growth conditions at lower price points was backed by increased competition for more affordable houses.
“This is where first home buyers, investors and, progressively, mainstream demand is most concentrated.”
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