Further declines ahead as major capitals predicted to fall 10% from peak

According to National Australia Bank’s (NAB) Housing Monitor August 2026, recent dwelling value data had indicated likely steeper falls than initially forecast.

Cotality’s latest Home Value Index showed Sydney’s dwelling values fell by 1.4 per cent in the month of July, with the city being 5.3 per cent below its January peak.

Meanwhile, Melbourne’s values were down 1.2 per cent month-on-month, after falling from their March 2022 peak by 5.5 per cent.

When it came to the combined capitals, NAB formally revised its outlook, predicting the eight cities would fall 5 per cent in the rest of 2026, instead of the 2 per cent decline previously expected.

“Recent data had left the risk skewed firmly to the downside of our earlier house price forecasts,” it said.

While Melbourne and Adelaide were leading the downturn, NAB predicted 2–4 per cent declines across the mid-sized capitals until the possible 2027 recovery.

In July, Cotality’s data showed that Brisbane, Perth, and Adelaide prices were 0.4–0.7 per cent lower than their peaks in May of this year.

Brisbane and Adelaide recorded drops of 0.6 per cent and 0.2 per cent respectively over July, marking their second consecutive month of declines.

While not yet part of the downturn, Perth saw only modest value growth of 0.1 per cent over the month.

Ultimately, NAB said the downturn was different from the one seen in 2018–19, as the price declines were not being driven by an oversupply of homes.

“2018–19 price declines followed the east coast apartment boom, with improved supply conditions having been feeding through into cooler rent growth for some time,” it said.

“That is not the case now. Vacancy rates remain low and advertised rent growth remains elevated.”